While Nigeria has about 96.4 million adult population, it is sad that 40.1 million (almost half of the population) are financially excluded in a digital age where ePayment, eCommerce, among other hassle-free financial services, products and banking innovations are trending.
Moreover, it is also shocking that women, youth under 35 years, rural residents and those in Northern Nigerian, particularly North West and North East are the most financially excluded.
As well, the development is a big challenge to the actualisation of Nigeria’s 80 percent financial inclusion target by the year 2020; an initiative of the Central Bank of Nigeria (CBN).
However, the situation is worrisome to First Bank Nigeria Ltd., which is unarguably, the leader in electronic payment services adoption in Nigeria.
The foremost tier1 bank has been in the forefront of supporting and implementing CBN initiatives aimed at aiding robust, more secured and vibrant financial system and most recently, the campaign for financial inclusion, which among other benefits, would lift many Nigerians out of poverty.
In furtherance of the campaign, First Bank organised a joint seminar for banking and telecoms regulators on the theme, ‘Advancing ePayment and Digital Innovations in Africa- Evolution of Nigeria’s Payment Systems’.
The seminar, which held on July 8, 2019 at Lagos Continental Hotel, Victoria Island, Lagos, was timely and a boost to financial inclusion across the country, especially among the unbanked.
From tracing the evolution of payment systems in the country, the appraisal of the feats achieved so far in financial inclusion and solutions on how to tackle the challenges in the actualisation of a full-scale financial inclusion across Nigeria, the seminar was worth attending.
Of course, you do not expect less with delegates from the Central Bank of Nigeria (CBN), central banks across West Africa, Interswitch, Nigerian Inter-Bank Settlement System (NIBSS), executives from First Bank branches in Gambia, Sierra Leone, Ghana, DRC Congo, Guinea, among executives from telecom and fintech companies.
The burden of the millions of unbanked Nigerians has made First Bank to engage in series of researches, and seeking sustainable ways of wooing them to the financial space.
In his presentation at the seminar entitled “The Role of Mobile, USSD and Agent Banking in Financial Inclusion – The FirstBank case”, Chuma Ezirim, group executive, eBuisness & Retail Products, First Bank, highlighted some of the facts supporting the bank’s commitment at assisting the CBN to achieve its financial inclusion target in Nigeria.
According to him, despite being the oldest existing financial institution in Nigeria (established 1894), First Bank has evolved with many innovative products and services even targeted at boosting financial inclusion in Nigeria.
For him, the FirstMonie was one of such innovations aimed at taking banking to the grassroots and lifting the 40.1 million financially excluded Nigerians to exciting banking platforms.
As well, the Agent Banking offering is focusing on serving financially excluded individuals and small businesses in rural areas and is experiencing exponential growth with significant revenue and social impact.
According to Ezirm, First Bank has boosted financial inclusion in Nigeria with its Agent Network now covering 28,059 agent locations in 755 out of the 774 Local Government Areas in the country with 18 million monthly transactions valued at N240 billion.
Aside the Agent Network, First Bank is reaching out to the unserved with its USSD Banking offering. As at June, 2019, it has 7.7 million subscribers on the USSD platform and still counting with 62 million monthly transaction volume valued at N200 billion.
The good news is that over 75 percent of transactions carried out on the USSD platform were done by the bottom of the pyramid customer segment with feature phones.
Considering the fact that 36.6 million people, who are financially excluded are women, therefore women empowerment, according to Ezirim, is a key focus area in the financial inclusion mission of First Bank. “EFInA’s A2F 2018 survey indicates that 55.1 percent of the totally financially excluded people in Nigeria (36.6m) are women. Firstmonie Agent network therefore purposefully targets to empower women in order to bridge the financial inclusion gap, as well as, reduce poverty. Today over 6,000 women are active agents on the network, empowered to do more for their families and become employers of labor”, Ezirim said in his presentation.
Of course, Musa Jimoh, deputy director, Payment System Management, Central Bank of Nigeria (CBN), agreed that granting financial access to the poor is a sure way of reducing poverty.
He said at the seminar that in line with this, the CBN is at the forefront of the campaign for financial inclusion and has even forced commercial banks to reduce the requirements for opening accounts to encourage the millions of unbanked to get on board.
He highlighted other initiatives by the CBN to woo the unbanked and collaborate with commercial banks, fintechs, among other stakeholders in achieving 80 per cent financial inclusion target by 2020.
Some of the feats achieved by the CBN in financial inclusion, according to Musa, include; mobile money to push financial services closer to the people; cashless policy to reduce cost of financial services and encouraged digital payment system and the Biometric Verification Number (BVN) with 35 million bank customers captured.
To understand the imperative of financial inclusion in today’s banking system, Mike Ogbalu, divisional chief executive officer, Interswitch, in his presentation at the seminar titled, ‘The Evolution of Payments in Nigeria’, highlighted the feats achieved so far, as well as, commending First Banks for leading the financial inclusion campaign with its several innovations.
For him, the Nigerian payment system has evolved in the last 20 years with the first ATM by Societe Generale Bank of Nigeria in 1987, first offline POS, interbank ATM, Quickteller, Verve, BVN introduction, migration from magnetic stripe to EMV cards and presently to over 20, 000 multifunctional ATMs across the country.
Other initiatives that have aided financial inclusion in Nigeria, according to Ogbalu, are the cashless policy of CBN, which resulted in a revolution that boosted eCommerce, ePayment, electronic revenue collection, web payment and birth of fintech and eCommerce companies such as Jumia, Remitta, Konga, Payporte, Paystack, MallforAfrica, among others.
Ogbalu commended First Bank for being the largest issuer of Verve card and the only bank to have ATMs across all the local government Areas in Nigeria.
But the smooth interaction by stakeholders courtesy of the NIBSS Instant Payment, according to Premier Oiwo, managing director, Nigerian Inter-Bank Settlement System (NIBSS), has enabled banks to be well-positioned to implement financial inclusion, as the point-to-point fund transfer service has averted the chaotic situation hitherto experienced in settlement among banks.
For a full-scale financial inclusion, the delegates of the seminar, especially members of the panel of discussion, agreed that the focus should be on mass market customers.
Also, they pointed to the direction the payment evolution is heading; scan-to-pay, wearables, APIs, blockchain & distributed ledgers, open banking, social payments, PSBs, and more.
But First Bank is set for the trends with innovative products and services, Adesola Adeduntan, chief executive officer, First Bank Nigeria Ltd., assured.
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