Nigeria’s population is growing exponentially. According to the World Bank, it is projected that Nigeria will outgrow the population of the United States by about 30 million people by 2050.
It is not clear if this will be a dividend or a disaster. What is, however, visible is that Nigeria’s adult population is on the rise. This poses a challenge to the traditional banking model which has intentionally or unintentionally excluded rural communities, heralding the need to restructure the typical method of banking.
This and the government’s intervention has created an opportunity for deeper digital technology in financial services.
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Africa is revolutionizing its financial sector to include the under and unbanked. Here are five things you should know about the financial inclusion drive in Nigeria:
- National Financial Inclusion Strategy (NFIS): In 2012, the Central Bank of Nigeria (CBN) introduced the National Financial Inclusion Strategy (NFIS) in a bid to increase financial inclusion in Nigeria. The main goal of the NFIS is to ensure that 80% of Nigerian adults are financially included by 2020.
- Nigeria’s adult population: As at 2018, the Access to Financial Services Survey by Enhancing Financial Innovation and Access (EFInA) estimated that 36.6 million adults, representing 36.8% of Nigeria’s adult population, are financially excluded.
- Nigeria’s rural community: In 2019, the world bank reported that Nigeria’s rural population was estimated at 98.1 million people, which is 48.8% of the total population.
- Agent Banking: In 2013, the CBN introduced the agent banking guidelines as a strategy to further deepen financial inclusion. According to the guidelines, institutions can appoint third parties as agents to provide financial services on their behalf.
- Innovation in the Sector: Since the introduction of the NFIS, the financial services sector has seen immense innovation and growth with MTN Nigeria, through its subsidiary, Y’ello Digital Financial Services (YDFS) launching the MoMo Agent service to further deepen the CBN’s financial inclusion drive in 2019.
With over 108,00 agents in financially under-served communities across Nigeria, MoMo Agent has now expanded its service to include bill payment, cash deposit and withdrawal, data and airtime purchase, and bulk disbursement services to anywhere in Nigeria without a bank account.
