The total number of deposit accounts opened by regulated financial institutions increased by 16.85 percent to 158.1 million in 2019 from 135.3 million in 2018.
Last year witnessed aggressive push for cheap loans by Nigerian Deposit Money Banks (DMBS), which attracted a good number of the unbanked and the under-banked into the financial services sector.
Also, to promote increased credit to the economy, the Central Bank of Nigeria (CBN) increased banking sector Loan to-deposit Ratio (LDR) to 60 per cent and later 65 per cent in 2019.
This development was expected to increase lending to the real sector and deepen financial inclusion in the country.
The CBN on Monday released the 2019 annual report of the Nigerian National Financial Inclusion Strategy (NFIS).
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NFIS was launched on October 23, 2012. The aim was to reduce the percentage of adult Nigerians who do not have access to financial services from 46.3 per cent in 2010 to 20 per cent in 2020. In addition, the strategy stipulates that 70 per cent of those to be included in the financial system by 2020 should be in the formal sector.
The deposit accounts comprised of accounts held by Deposit Money Banks (128.1 m in 2019), accounts held by Microfinance Banks (14.8 m in 2019) and wallets held by mobile money operators (15.2 m in 2019).
This figure does not give the unique number of account holders as one individual may hold more than one account in 2 or more financial institutions.
However, the unique bank verification number registration holds that there were 40.7 million unique Bank Verification Number (BVN) by December 2019.
According to the report, access to formal savings represents the first point of contact for the unbanked to enter the formal financial system.
Looking to the 2020 targets, at least 12.5 million previously unbanked Nigerians need to be formally included in the financial system to achieve 80 per cent financial inclusion.
This group of persons may be brought into the formal financial system either through opening a bank account or a mobile wallet. In either case, new entrants into the formal system are expected to obtain a Bank Verification Number.
The Bank Verification Number (BVN) is a unique identity number issued to every individual who owns an account in the Banking sector. As at December 2019, the number of people who had a BVN increased to 40,704,517 from 36,169,604 in 2018. Gender disaggregated data shows that more male (23,753,174) are banked compared to female (16,951,343).
“Beyond 2020, there is still much left to be done. Our strategic aspiration for financial inclusion by 2024 is to achieve 95% inclusion in Nigeria and this would mean an environment with a profusion and prevalence of financial access points, products and services, a financially literate population, and a digital savvy customer base. I believe that this is achievable if we all continue to work together,” Godwin Emefiele, governor of CBN said.
