E-Financial
How to Deepen Financial Inclusion in Nigeria, by ALMPO Mobile Money Confab 2019
The burden of delivering financial inclusion to the last mile has become one that needs the strategic participation of all industry stakeholders in the ecosystem, so as to deliver value propositions that will deepen financial services culture for the benefit of the citizenry.
These were the views of participants at the 2019 Mobile Money Conference, organized by Association of Licensed Mobile Payment Operators (ALMPO).
The event themed: ‘Beyond Payments’ was held on Wednesday, 27th November, 2019 at Four Points by Sheraton, Victoria Island, Lagos.
Chinedu Onuoha, chairman, Association of Licensed Mobile Payment Operators (ALMPO), noted that the aims of financial inclusion should not be limited to payments alone, that is, paying and receiving of money.
He stated that financial services should be made to cover areas that are germane for the average citizen if we are to achieve the objectives of financial inclusion.
He explained that financial services should be all encompassing and focused on rendering everyday services that go beyond payments services.
According to him, “The theme of this year’s conference aptly captures the general direction of the industry. We are of the opinion, and rightfully so, that for the objectives of financial inclusion to be realized, we must go beyond payments, as we try to attract more people into formal financial services.
“We are aware that the financial needs of the average citizen are much more than pay and receive. People want to save and earn interest.
“They want to participate in pensions, they need some form of insurance, and many more. We also know that for all of this to realized, there must be adequate security and trust in the system.”
Onuoha called for collaboration of security agencies and other government agencies, which according to him, would create the right synergy that will secure the payment system and provide adequate protection to operators as they go about their business.
Aishah Ahmad, deputy governor, Financial Systems Stability, Central Bank of Nigeria (CBN), stated that Mobile Money (MM) is vital to CBN as a regulator and as such, they are open to suggestions on the way forward, without holding on to rigid regulations.
Ahmad who was represented by Aisha Isa-Olatinwo, assistant director, Payments System Management Department, CBN, noted that since estimated reports show that Nigeria has over 100 million unique mobile numbers, if mobile money operations work, there will be over 100 million subscribers.
She enjoined everybody present at the conference to work together to create a success story that will be beneficial to the ecosystem and the entire citizenry.
Uzo Eziukwu, group CEO, BlueTag Group, in a keynote address said that Mobile Money is fast becoming Africa’s legacy to the world, using Kenya’s MPESA as a typical example, doing about 1.7 billion transactions per year and making up to 50% of Kenya’s GDP.
He revealed that there are over 120 Mobile Money Operators (MMOs) in Sub-Saharan Africa (SSA), and they came into Nigeria in 2010 with a focus to drive financial inclusion and as an adjunct to mainstream banking.
He dissected the journey of MM in Nigeria into four stages, according to him, the first stage was the pilot stage between the years 2010 and 2012, which served as linkage of MM into mainstream banking.
According to the Eziukwu, “this was a time to understand the regulatory environment and regulators. This period saw confusion between collaboration and competition.
“This stage saw operators understanding the peculiarities and challenges of the Nigerian landscape. The need to collaborate and align effectively with telcos was also noticed.This stage had the challenges of integration and knowledge sharing”.
The second stage, according to him began from 2013 to 2015, which saw constructive engagement and alliance, as bank and non-bank MMOs engaged with one another and CBN. Also, partnerships arose between MMOs and banks, as CBN further streamlined MM policies.
“These moves saw growth in MM adoptions and in the number of bank accounts, noting also that this stage saw significant growth in MM acceptance driven majorly by the already banked.
He further revealed that innovation in mobile money operation has to be wrapped around consumer needs and not just payments, needs like micro-credits and service-based lending.
He also suggested products to be created for those at the bottom of the pyramid, products like health insurance, micro-pension, interest-based micro-savings, and rotational savings.
Acknowledging that the theme of the conference was apt, he concluded by sharing that as MM is moved forward, the sound benefits of financial inclusion will be unraveled.
Professor Olayinka David-West, academic director, Lagos Business School, delivering a paper Titled ‘Harnessing New Opportunity Areas for Mobile Money Adoption in Nigeria’, decried that only 4% increase in digital payments was recorded since 2016.
She further revealed that out of the estimated 99.8 million adults in Nigeria, only 3.3 million are MM users, and of the 36.8% excluded, most are women.
She reminded that engaging the bottom of the pyramid does more than gaining financial inclusion, but it also enhances the social and economic development of the society.
She also shared that a compelling value proposition is needed to get the attention of the customers. She argued that if the products and services don’t fill the proposition, MM won’t get to the Promised Land.
She also talked about taxes and levies, cybersecurity and fraud, connectivity and power, sharing how the setbacks and challenges in the sectors affect the adoption of MM by the masses.
Mrs Bunmi Ogunlewe, head of Product, e-tranzact, who spoke about shared services platforms as enablers for Mobile Money Growth, said that with the various needs faced by people at the bottom of the pyramid, collaboration is needed to address them.
She advised that the MMOs should come together and build an informed credit system which will help in the journey of MM through the last mile.
She shared that while each MMO collates data, until collaboration is done the data will be useless whereas with collaboration, fresh, enormous, insight will be gotten.
She opined that shared services and shared infrastructure will help get an additional 50 million customers and without shared platform services, the adoption and growth hoped for by MMOs won’t be attained.
The conference had different panel sessions that proffered solutions on how we can reach the last mile and as well set a new agenda for the next decade which will see the implementation of the solutions achieved in driving financial inclusion in Nigeria and indeed Africa.
National Identity Management Commission (NIMC), Nigeria Interbank Settlement Systems (NIBSS), AfriGO and other stakeholders are set to roll out digital cards with multiple wallets to drive financial inclusion and improve Nigeria’s Gross Domestic Product (GDP).
The digital cards with multiple wallets would allow Nigerians to have access to government services in all Ministries, Departments and Agencies (MDAs) of government, while it would also provide platforms for students to access government loans.
Already, Nigerian farmers captured under the Federal Ministry of Agriculture and Food Security, (FMAFS) have embraced the digital cards for government services in areas of provision of agric loans, seedlings and other inputs that would improve food production and security.
According to Abisoye Coker-Odusote, director general/chief executive officer, NIMC, the biometric NIMC-enabled cards have multiple features to address the socio-economic needs of Nigerians in line with the 8 point Agenda of President Bola Tinubu.
Coker-Odusote, who addressed newsmen at the headquarters of NIMC in Abuja on plans regarding the launch of the cards, was flanked by Mr Premier Oiwoh, managing director/CEO, NIBSS; Mrs Ebehije Momoh, managing director/CEO of AfriGO; and Mr Femi Akande, managing director, Data Mining Company.
She said the stakeholders were brought together to explain the different benefits associated with the digital cards to Nigerians and the general impact it would have on the economy as President Tinubu hoped to drive his welfare programmes using digital identity verification as a major platform.
The NIMC boss said the multiple purpose cards would be available to citizens, home and abroad and legitimate residents who could use the cards for various transactions, especially payments of water and electricity bills, transportation services, and shopping, among others.
The cards, she explained, could be used off line and online to provide services for unbanked citizens in rural areas and bring on board those whose businesses required government support for survival, noting that with such opportunities, Nigerians would need no god father to access government services and support.
Coker-Odusote said the digital cards which come with various security features cannot be forged as the biometric information of owners are embedded in them, emphasising that they were made to address current needs of government to ensure that there are no ghost beneficiaries of government palliatives, loans and other benefits.
She assured that the cards would turn around the economy by improving revenue generation and the country’s GDP as states governments and the private sectors would be part and parcel of it.
Speaking on behalf of other stakeholders, Momoh of AfriGO, said the launch of the cards would change the narratives for the country’s economy as it would ensure that the flow of money remained within the economy.
Momoh said: “The digital card is a domestic solution to drive financial inclusion and provide cost effectiveness and transparency within the systems. It would ensure data sovereignty and autonomy, and we all know that data is significant to improve our economy.
“This card will help reduce cost, especially dollar given to banks. Domestic payments are important to support welfare and social interventions services of government, so it will help drive cashless policy and ensure that our monies remain within the economy.
“We have about 26 banks already issuing the cards and it is hoped that more would come on board. Nigeria is the first country to come up with this innovation, and surely it would enhance micro-medium enterprises across the country.”
Wema Bank has announced plans to conclude its capital-raising efforts with a robust strategy combining a Rights Issue and a Special Placement exercise, both scheduled to commence on April 1, 2025.
The initiative aims to secure N200 billion in fresh capital, marking a significant milestone in the bank’s growth journey.
This marks the second and final tranche of Wema Bank’s comprehensive capital-raising exercise, following the successful first tranche, which generated N40 billion.
By securing this additional capital, the bank is poised to exceed the Central Bank of Nigeria’s (CBN) minimum capital requirement for national banking authorization, thereby solidifying its financial strength and positioning for sustained growth.
The move underscores Wema Bank’s commitment to maintaining robust financial health while enhancing its ability to deliver innovative banking solutions.
In its usual manner as a proactive, innovative and forward-thinking bank, Wema Bank, had prior to the CBN announcement, already launched a N40 billion rights issue as far back as December 2023, receiving the approval of the CBN and the Securities and Exchange Commission (SEC) in 2024.
This resulted in the Bank’s successful completion of the first tranche of its capital raise exercise. With over 30% of the CBN target of N200 billion already met, Wema Bank is proceeding to initiate the second tranche of capital raise come April 2025, this time, with the goal of raising N200 billion in fresh capital to complete its capital requirement.
Confident in the outcome of the upcoming rights issue, Wema Bank’s Managing Director and Chief Executive Officer, Moruf Oseni, assured shareholders and other stakeholders of a successful conclusion of the capital raise program.
According to him, “We stand strong today not just as Nigeria’s oldest indigenous bank but also as Nigeria’s leading innovative bank. Wema Bank turns 80 this year and I can safely tell you that we have never been more driven to excel.
I am blessed to lead with the support of a team of determined and driven professionals who will leave no stone unturned in achieving our strategic aspirations. Indeed, we are building Wema Bank into a formidable force in the African financial services landscape”.
“We remain dedicated to maintaining transparency throughout this process and will provide regular updates to all stakeholders and shareholders as we go forward. This capital raise will be a win-win for us all. You can trust as always that your investment in Wema Bank will produce exceeding returns. This is our promise to you”, Oseni concluded.
With the deadline for CBN’s recapitalisation exercise set for March 31, 2026, this move by Wema Bank will undoubtedly ensure the bank retains its national banking license way ahead of the deadline
Reaffirming its stance as a Bank committed to transparency and adherence to regulatory standards, Wema Bank is working to secure all necessary approvals from relevant regulatory authorities to ensure the process is conducted in full compliance with applicable guidelines.
Olayemi Cardoso, Central Bank Governor, announced on January 23 that Nigeria’s Gross Domestic Product (GDP) is projected to grow by 4.17 percent, while inflation is expected to ease in 2025.
Currently, Nigeria’s inflation stands at 34.80 percent, but Cardoso is optimistic that it will decline as President Bola Tinubu’s reforms take effect.
Cardoso also mentioned that foreign exchange reserves have risen gradually, driven by increased oil production. Oil output is forecast to reach 2.3 million barrels per day by mid-year.
He pledged to increase Nigeria’s foreign exchange reserves to over $40 billion after recording a $6 billion FX inflow in 2024.
The central bank’s priority remains maintaining price stability and bolstering market confidence. Cardoso emphasized the importance of enhancing transparency and efficiency within the foreign exchange market, expecting more appetite for real sector development with limited opportunities for FX arbitrage.
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