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Wednesday, May 13, 2020 / 2:39 PM / Bukola Akinyele for WebTV / Header Image Credit: Ecographics
The Programme Specialist
for Enhancing Financial Innovation and Access (EfinA), Mr. Henry Chukwu,
recently spoke on the prospect of deepening Financial Inclusion in Nigeria as a
guest speaker on WebTV's Economy and Politics Show.
Chukwu said that Financial
Services Agents spread across the country need continuous support from
financial institutions to carry out their duties effectively.
Speaking on how COVID-19
has affected Nigeria's 2020 financial inclusion target at a 20% exclusion
rate, Chukwu disclosed that the pandemic has affected the actualization
of the target as the country is less likely to achieve its inclusion goal by
the end of the year. According to him, the spread of the virus affects the
lower rung of businesses and jobs that rely on daily business to earn income.
Sharing his thoughts on
the EfinA Access financial survey 2018, he said that out of 44.3million adults
that owned businesses about 23million adults earned income from daily
activities. Looking at this figure and considering the restrictions on movement
and enterprise placed by the government a lot of these individuals have
had their livelihoods disrupted and become financially excluded.
Looking back to 2016-2018
the excluded population declined by 8.23% from 40.1million adults
excluded in 2016 to 36.8million adults excluded in 2018 the percentage decline
within 2 years shows it would be difficult to reduce the 16.8% difference
between the target of 20% by 2020 and the current 36.8%.
According to him, EfinA's
focus is to build resilience in financial service providers such as agents and
individuals needed to combat the effects of COVID-19, EfinA would put a lot of
effort into providing credible information that could support financial service
providers within the period.
Speaking further, Chukwu
explained that EfinA had worked very closely with the Shared Agent Network
Expansion Facilities (SANEF) and other stakeholders to understand and
identify opportunities of harmonizing efforts and continuing to deepen access
to financial services in Nigeria.
He commended the Central
Bank of Nigeria (CBN) for commencing several initiatives such as the 50billion
credit facility to support individual households affected by COVID-19 and the
reduction of the interest rate on government intervention loans from 9% to 5%.
In respect of the challenges faced by financial services company's in supporting inclusion, he said the major challenge was the low level of economic activity which had cost several jobs and livelihoods.
He was of the view that
despite the challenges there was still an opportunity for the industry to
leverage the palliative measures provided by the federal and state governments
to deepen financial inclusion, drive account opening, increase financial
literacy, improve financial capability among beneficiaries while also driving
financial inclusion in the country.
Speaking on what needs to
be done to extend palliatives to the informal sector and financial service
agencies. Chukwu noted that there was a need to use the resilience of agency
activities, and enlighten them on precautionary measures to prevent poor
business choices whilst promoting collaboration to generate business activities
that would support transactions.
Giving insight into the
breadth of Agency banking in all 774 local governments in the country,
Chukwu said the only channel that ould be used to extend financial services to
the LGAs was through agents and this was the time for agency banking to adopt
appropriate strategies to deepen the deployment of the agent network in rural
areas to continue to provide business. He noted that EFINA was working
variously with SANEF, stakeholders and service providers to see how they could
support agents and identify problems within the industry. He said Post
COVID-19, there was a need for sustained activities to reassure agents of
commitment to support them.
Speaking on the
interaction with the Fintech Community, according to him, the Fintech community
was very critical to financial inclusion by providing innovative ideas to
support the expansion of services. "We have seen a lot of opportunities
around Fintech and we would continue to engage and support them to come up with
initiatives that ould deepen financial inclusion", Chukwu said.
On how to improve women's
financial inclusion, Chukwu believed that women had a huge role to play in
terms of driving financial inclusion and promoting overall improvement in the
household economy.
He said EFINA partnered
with Central Bank of Nigeria (CBN) to understand inclusion among women looking
at the women exclusion rate of 55%. Chukwu noted that EfinA tried to
understand the factors that affected women financial inclusion in the country
and how best to improve the conditions that promote increased women
participation.
He encourages more women
to become financial activity, he noted that in the North West 65% of women were
financial excluded and in the North East 68% of women were financial excluded.
Speaking on deepening
financial literacy in Nigeria, Chukwu observed that financial literacy was very
important for EfinA, the organisation works closely with other stakeholders to
drive financial literacy. He said that by deepening financial literacy,
individuals would have the proper set of knowledge and skills to grow their
businesses and make positive contribution to the economy at large.
He called for regulatory
flexibility post-COVID-19 to ensure consumer protection and also the National
Insurance Commission (NAICOM) to push for the adoption of Microinsurance which
was very important especially for low-income enterprises and individuals.
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