BY: justice Godfry
The Central Bank of Nigeria (CBN) in October 23, 2012 launched the Nigerian National Financial Inclusion Strategy (NFIS).
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.
But, in the 2017 Annual Report on Nigerian National Financial Inclusion Strategy Implementation, the apex bank recognised that “The year, 2017 witnessed increasingly sustained efforts of stakeholders to accelerate progress towards the 20% exclusion rate by the year 2020.
“Against the background of on exclusion rate of 41.6 percent in 2016 as per the survey results of the Enhancing Financial Innovation and Access (EFInA) Access to Finance Survey in Nigeria in 2016, the need to double efforts has become apparent. The Central Bank of Nigeria and indeed all the implementing stakeholders demonstrated strong commitment to innovate new ways of increasing the speed towards the 2020 target”.
In other words, the strategy is likely not to be achieved if critical steps are not taken to address certain issues that have bedevilled the financial inclusion efforts.
The Nigeria Bankers’ Committee; National Association of Microfinance Banks; Nigeria Insurers Association; Bank of Industry as service providers have looked up to National Deposit Insurance Corporation (NDIC); Nigerian Communications Commission (NCC); Nigeria Postal Service (NIPOST); Pension Commission (PenCom), the Central Bank of Nigeria, etc., as the enablers to assist in bringing the millions of the financially excluded Nigerians to the ecosystem.
But while speaking to TechEconomy.ng at the recent Lagos Fintech Week, the Chairman, Dr. Yele Okeremi, suggested that technology should not be blamed for the inability of the stakeholders to bring the people on board.
He believes that the most prerequisite to financial inclusion is financial capacitation.
“For someone that does not have financial capacity what are you going to include? Therefore, we need to ensure that people are enabled to participate financially.
“We have lots of people living below $2 per day. So, who are you including? It is really a waste of time to shout about financial inclusion (FI) when there is no financial empowerment (FM). When FM happens then we begin to look at how to ‘include’ to in the ecosystem”, Dr. Okeremi said.
Dr. Okeremi also spoke on the preparedness of Nigeria to play in the Open Banking space:
“Well, security concerns are everywhere, but if you take a look at how open banking is supposed to be practiced: the kind of security concerns that people talk about don’t really exist. For example, people who are afraid of giving out their credentials; that is not what open banking is looking at rather they give concepts to be able to access data.
“The most important thing about open banking is called parameterisation. So, proper parameters are run between the public and the ultimate data. There could be breaches that happen from time to time, but that is not sufficient reason to say that Nigeria is not ripe for it. Open Banking has come to stay”.
Nodding in agreement, the Chief Executive Officer of Open Vector Limited, Carlos Figueredo, said that operators in the open banking ecosystem are working hard to ensure hitch-free operations.
“Anything financially based would always attract the attention of the cyber attackers. But the greatest risk revolves around lack of education.
“If you are completely educated on how to do what you do, things are going to be a lot easier and protected. To give you an example, in the way we use our passwords for banking, if you are not educated on how to do it, you put yourself in risk, because you share your information. But if you can protect your password, it is also applicable to the open banking system,” he added.
On regulations that need to be in place to drive the ecosystem, he suggested that regulations that are solid enough to protect the consumer must not be neglected.
He further said that the consumer deserves the right to make choices while using third-party or payment providers’ platforms.
Meanwhile, Dr. Okeremi x-rayed the significances of Lagos Fintech Week, he said, “The significances of the Lagos Fintech Week is to celebrate what we have; to make networking possible. People are doing different things; are there possible bridges. It is also a time for us to come, learn and share ideas.
“People need to know about Fintech. Again, publicity is never enough. We want to say to people ‘hang-on, there are many things we are better on and others we aspire to be’. Yes, we have a lot of rooms for improvements but let’s look at the beautiful things we have done and be able to celebrate them.
“We have the competencies or/and capacity and almost can guarantee that the opportunities are there to harness”.
Source: TechEconomy.ng