The platform called ‘Intermember Liquidity Placement Platform (ILPP)’ the company believes will change the way microfinance banking services are delivered in Nigeria, and also increase consumer confidence in the industry.
This development was unveiled during a high-impact business forum for key stakeholders in the microfinance industry, organised MDCL, with the theme: ‘The 21st Century MFB: Leveraging Technology to Drive Financial Inclusion in the MFB Industry”, held in Lagos.
Obinna Onunkwo, chief executive officer of MDCL in his opening remark said the company had entered into strategic partnerships with technology companies to increase capacity of microfinance business in Nigeria with launch of shared services platform, pointing that the event was put together to address some of the critical challenges the microfinance industry was facing.
He said one key partnership is with InfoWARE, a software company that helped MDCL build the Intermember Liquidity Placement Platform (ILPP) which enables microfinance banks to place liquidity among themselves.
“Another one is with Stanbic IBTC to provide on-lending facility to its members, while the last one is the creation of a digital lending platform for microloans, built in partnership with Migo”.
Onunkwo said it’s important for all MFBs to unite and speak with one voice, so we can have a voice in the bankers’ committee meetings and be able to pursue policies that affect us as an industry.
Corroborating Onunkwo’s position, Rogers Nwoke, board chairman of MDCL noted that financial inclusion had been a struggle for a very long time, and we are yet to meet the targets set by the CBN in that regard. One reason for that was the absence of liquidity for microfinance banks.
According to Nwoke, MDCL is a response to the problem of funding. We are here to have a discussion on how to drive financial inclusion with technology, and we are going to crown the discussion with a launch of the Intermember Liquidity Placement Platform (ILPP).”
Yusuf Ahmad Gyallesu, president of NAMB, pointed out that the ILPP was a very good initiative and a dream come true for the microfinance industry, as it would provide them an opportunity to look inwards for liquidity, instead of looking outside. He then encouraged all microfinance banks to cash in on the solution to move their businesses forward.
While delivering the keynote address, Lawrence Amadi, partner and head of Technology Assurance at KPMG, said that, with a population of over 200 million people in Nigeria, over 80 million are financially excluded and microfinance banks have a key role to play in helping to reduce that number, in line with the CBN’s goal of having 80 percent of the population in the financial net.
According to him, “supporting innovative thinking is what MFBs must do in order to successfully drive change in the country. To do this effectively, they have to tap into technology to transform the entire financial sector.”
In a goodwill message by Nkiru Asiegbu, director of other Financial Institutions Supervision Department (OFIS) of the CBN, who was represented by IdowuAkinlade, head of Microfinance Supervision mentioned that the event could not have come at a better time, considering that the industry is experiencing a high influx of FinTechs.
While commending MDCL for the great initiative to solve the liquidity challenge in the MFB industry through the ILPP, she pointed out that “innovations may solve some problems, but they may also create new ones.” It was therefore pertinent for the promoters to mitigate against server risk, operational risk, credit risk, compliance/money laundering risk, data security risk and other possible risks that may arise from the use of the platform.