• Tuesday, February 27, 2024
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Nigeria’s widening wealth gap: The middle-class are becoming poorer, while the poor sink deeper into poverty

Nigeria’s widening wealth gap: The middle-class are becoming poorer, while the poor sink deeper into poverty.

Happy New Year!

I know it’s the end of January and the title of this piece is everything but happy. However, the greeting too has become perfunctory, much like routine phrases such as “Good morning” or “How are you?”—often expressed without genuine interest. However, that’s not the story. My motivation for writing this piece stems from a stark realisation prompted by a tweet from Taiwo Oyedele, chairman of the Presidential Fiscal Policy & Tax Reform Committee.

Oyedele’s message highlighted the staggering income disparity in the country, stating, “If you earn N3.5m per annum, you are in the top 1% of Nigeria’s population, and it’s not because you are rich, it’s because others are so poor.”

Delving into the numbers, breaking down the annual income of N3.5 million into a monthly average of N290,000, and contextualising it as income for the “top 1% of the population” within the current hyper-inflationary environment left me disheartened and somewhat traumatized. This reality was further emphasized when an unregistered number contacted me urgently, revealing himself as the facility manager from a previous residence—an educated individual struggling to make ends meet with less than N1,000 to his name.

While poverty in Nigeria is not a revelation to me, Oyedele’s tweet, coupled with this personal encounter early in the new year, made me confront the harsh realities faced by a significant portion of the adult population. It prompted deep reflection on my advocacy work, focusing on integrating the most vulnerable groups into the formal financial sector as a sustainable means of poverty alleviation. These groups, residing in remote rural areas with limited access to power, poor road networks, and connectivity, exemplify the profound disparities existing within and between communities.

Read also: Inflation pressure plunges more Nigerians into financial crisis

Recent data from the Access to Financial Services survey by EFInA revealed a worsening financial health scenario for Nigerians post-COVID and economic recessions. The survey indicated that 78% of adults (87 million) would struggle to generate NGN75,000 within 7 days in the event of an emergency. This data reinforces Mr. Oyedele’s tweet and underscores the urgent need to address the erosion of the middle class and the high level of unequal wealth distribution.

My 11-year-old daughter’s realisation that international travel costs a significant amount in Naira led to her concern about the attainability of such experiences. This concern becomes more profound when considering situations where individuals, like a nail technician in an up-market Lagos salon, express overwhelming gratitude for a N40,000 contribution towards their children’s school fees.

From my vantage point in financial inclusion advocacy, I recognize the pivotal role that financial inclusion plays in alleviating poverty by ensuring equitable distribution of financial resources. While it may not be the only solution, financial inclusion aligns with 8 of the United Nations’ 17 Sustainable Development Goals, making it a crucial aspect of sustainable poverty alleviation.

In conclusion, I echo the call from CBN Governor Olayemi Cardoso to “shift from collaboration to commitment” in achieving the country’s financial inclusion targets. A higher number of financially included Nigerians brings us closer to narrowing the wealth gap by providing widespread access to financial resources that empower all.

About the author:

Chinasa Collins-Ogbuo is an empath with a fiery passion for justice and fairness. She leads the Inclusion for all Advocacy & Communications department at EFInA (Enhancing Financial Innovation and Access) where her primary mandate is to lead strategic advocacy efforts for policy and regulatory changes to remove the multifaceted barriers that keep the poorest and most vulnerable Nigerians excluded from formal financial services. Her work at EFInA and her personal initiative;Social Conscience with ‘Nasa (SCwN) are expressions of her deepest passions and core values.

Email: [email protected]
Linkedin: https://www.linkedin.com/in/chinasacollins/