Latest report from the Lagos Business School (LBS), has revealed that 49 per cent of Nigerians have viable bank accounts thus making the country’s financial inclusion efforts move at a slow pace.
Besides, the report also identified broad community engagement, religious institutions, and informal social groups as key elements to achieving the financial inclusion drive in Nigeria.
The report titled, ‘Customer Segmentation Framework’ by the Sustainable and Inclusive Digital Financial Services initiative (SIDFS) of the institution, also identified the need for unconventional approaches to on-boarding financially excluded persons such as the use of livestock ownership as collateral for financing, amongst others.
Speaking at the unveiling ceremony alongside an art exhibition in Lagos, Academic Director and Senior Fellow, LBS, Dr Olayinka David-West, said one of the many challenges of Financial Service Providers (FSPs) is limited knowledge of customers.
As a result, they often overlooked high potential customers or misidentify their needs, and invest in products and channels that sometimes miss the mark.
David-West, who doubles as the Lead, SIDFS, said the customer segments presented in the study provide insights into the behavioural and attitudinal traits of the Bottom of the Pyramid (BoP) population, currently estimated at 75 per cent of Nigeria’s population (about 135 million persons).
This is meant to provide FSPs with correct information to create fit-for-use, segment-aligned digital financial products.
She said: “Let us have some form of structured system so that people can move within the financial ecosystem, and use product and services that are appropriate to their needs.”
The report also identified six customer segments of financially excluded persons, which include vulnerable believers that form 12 per cent of the population; resilient savers (21 per cent); dependent individualists (22 per cent); digital youth (19 per cent), confident optimists (14 per cent), and skeptical cultivators (12 per cent).
Partner and Nigeria Director, Dalberg, Nneka Eze, said as part of its work to define a novel, globally applicable approach to segmentation, it conducted deep research in six countries across Africa and Asia.
“As with all the countries, the Nigerian report introduces a novel approach to segmentation that integrates contextual, behavioural, and psychometric variables that is useful in identifying patterns, highlighting nuances and differences between people that may not be clear from their contexts alone.
