Raise capital requirements for microfinance banks, expert urges

Modupe Ladipo , chairman of Enhancing Financial Innovation and Access (EFInA), has advised Central Bank of Nigeria (CBN) to raise capital requirements for microfinance banks to drive financial inclusion.

Ladipo gave the advice at the Accion Microfinance Bank Financial Inclusion Conference held on Saturday, September 30 2017 in Lagos.

The conference was themed, “Making Financial Inclusion a Certainty in Nigeria by 2020’’.

The year 2020 Financial Inclusion targets to provide universal financial access to all working age adults by 2020.

According to the EFInA boss, although more than 50 microfinance policies have been formulated to drive financial inclusion, a research conducted in 2016 shows that 41.6 per cent of Nigerians are financially excluded.

“In 2008, research conducted by EFInA revealed that about 53.5 per cent were financially excluded but CBN monetary policies such as mobile money transactions, agency banking system and micro insurance reduced it to 29.1 in 2014,” Ladipo said. “But as at 2016, the percentage of the financially excluded shot up to 41.6 per cent.’’

According to Ladipo, the micro insurance policy introduced by the National Insurance Commission (NAICOM) has not helped the country’s  financial inclusion drive much.

The microfinance expert said that there is an urgent need for CBN to increase capital requirements for microfinance banks so that more Nigerians could be brought into the financial net through micro finance.

“How many Nigerians will benefit from N20 million capital requirement for unit microfinance banks?’’ she asked.

Olubunmi Lawson, managing director, ACCION Microfinance Bank, said that the bank would continually drive financial inclusion using digital process.

She said that the bank has granted up to N6 billion loans to 169,000 customers since it was established in 2006.

“The bank also has 60 branches including in seven states.”

Accion Microfinance Bank was established to economically empower micro-entrepreneurs and low income earners by providing financial services in a sustainable, ethical and profitable manner.