Thursday, May 27, 2021 / 11:35 AM / by Straplan Advisory / Image Header Credit: Straplan Advisory
Financial Inclusion: a tool for driving an inclusive economic growth,
reducing inequality, eliminating systemic poverty and improving communal
Studies have shown a strong correlation exist between financial
inclusion and economic development
- A study by the World Bank in 2017 revealed that there was a strong
positive correlation between account penetration of various countries and their
Gross Domestic Product (GDP) per capita.
- Research has also shown that high-Income Countries with approximately
100% of account penetration posted GDP per capital ranging from $25,000 above
while Sub-Saharan African Countries with less thank 65% account penetration in
most cases recorded GDP per capita less than $10,000.
- A study carried out by Bruhn and Love (2014) showed that after a
rapid opening of bank branches in Mexico, an increase in access to
finance led to an increase in income among low-income individuals.
- In a similar study by Bugressand Pande(2005), a decrease in
poverty level was recorded in rural areas in India after the expansion of bank
branches to rural areas
is more about enabling transactional exchanges.
Digital technology has now made it easier to reach more people and
enable more transactions. The critical mass that is financially excluded
are also excluded in form of welfare and capacity development. Therefore, there
is need for an integrated digital economy approach that is tech-led and
directly engages the bottom of the pyramid.
financial inclusion is not an end in itself, it serves as a vital means to an
end: eliminating systemic poverty and improving communal welfare.
importantly, digital technology has of recent shown the capacity to serve as a
platform for enhancing all life activities. However, the emergence of fintech
companies in Nigeria has not fully impacted the underserved
Landscape in Nigeria
200 Fintechsare currently operating in Nigeria.
about $560mn USD in investments in the last 3 years
services rendered by these firms include:
FinTechshave accounted for ~10% of direct investment into Nigeria from
2017-2019 and can contribute pre-COVID -19 estimates of up to $3bn - EFinA2020
FinTechscould add up to $3bn through investments into the economy and
$1bn in additional revenues to the financial services industry in the long term
penetration of smartphones and mobile technology and a combination of unmet
needs have created the opportunity for Fintechs to drive financial inclusion
penetration have witnessed rapid adoption since 2014 and projected to
reach 143 million By 2025
globally have focused majorly on Consumers and MSMEs
use of digital channels and agents can be leveraged to reach the
underserved and unbanked in rural areas
are leveraging the use of smartphone data and BVN to provide loans to
mobile money operations in Kenya have driven financial inclusion over 80%
Adoption is relatively growing but still comparably low
youth and middle segment have seen early activity due to the low hanging
opportunity arising from many unmet needs (e.g. credit) and the higher
propensity to switch to digital alternatives.
still remain at bottom of pyramid as very few commercially viable use cases
have been developed to serve this segment. The MSME segment beyond payment has
also seen limited activity.
has been increasing focus on the mass segments particularly in lending &
payments as players have been attracted by the size of the segment and
regulatory focus on financial inclusion.
Making finance work for the bottom of the pyramid and the less
Full PDF Report Here
Drives Financial Literacy to build Sustainable Economic Growth
- CBN Targets
95% Financial Inclusion by 2024
Business Efficiency Through Analytics
and Using Data for Decision Making as a Business Owner
Visualization Training by Data Science Nigeria to Commence from February
- First Bank
Deepens Financial Inclusion with Largest Agent Banking Network, Empowers
Deepens Financial Inclusion, Opens Ultra-Modern Cash Centre At Ikorodu,
- Ecobank MD,
Others List Opportunities in Digital Financial Inclusion
Financially Excluded Nigerian Adult Must be Brought into the Inclusion
Bracket by 2020
Non-Interest Finance for Financial Inclusion