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NIBSS, CBN, Others Target 80% Financial Inclusion By 2020

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  • NIBSS, CBN, Others Target 80% Financial Inclusion By 2020

The Nigeria Inter-Bank Settlement System Plc (NIBSS), the Central Bank of Nigeria, (CBN), banks and telecommunication firms in the country have entered into a partnership on the Unstructured Supplementary Service Data (USSD) payment solution to further deepen financial inclusion.

The new initiative tagged ‘microCash (mCash) was unveiled in Lagos, yesterday by the lead promoter -NIBSS, with the CBN projecting that it would to facilitate 80 per cent financial inclusion in the country by 2020.

‘Mcash’ is a solution designed to facilitate low-value retail payments and growing e-payments by providing accessible electronic channel which is USSD. This would enable merchants and customers conduct transactions instantly as fast as a cash transaction.

This product is presently being operated by Wema, Zenith, Fidelity, Diamond, Unity banks, with other banks expected to sign up before the end of the year.

Also signed up are Airtel, Mtn, Etisalat and Glo. Under this platform, transactions below N10,000 would be conducted at no cost.

Speaking at the launch of Mcash, the Managing Director/ Chief Executive Officer NIBSS, Mr. Ade Shonubi said: “With Mcash, the whole intention is to broaden the opportunity for people who today use cash to find a convenient means of making payments. The central bank has been pushing the cashless initiative for a long time and we have seen significant gains but a lot of the people who have benefited so far have the 27 million banking customers.”

“As we begin to deepen and reach out to a lot more people, we biennial to make real the dream for financial inclusion as we begin to realised that a lot of government social programs would touch a different set of people so we have to start creating opportunities for them to have commerce that is not just lied around cash.”

He further added: “To achieve that, the banking industry and telecoms have come together to partner and find a way to deliver a service at a reasonable value point which is in terms of efficiency and price and addressing concerns of being able to attain that their transactions are made.”

“The people we are trying to bring into this space use cash and the advantage of cash is that you can exchange it immediately. The ability to get your money almost immediately is the key. Secondly, if you are trying to move the. To something other than cash, it also has to be continent.”

On his part, the Director, Banking and Payment, CBN Mr. Dipo Fatokun, described the solution as another effort by the apex bank in increasing financial inclusion to meet its Payment Systems Vision 2020.

Fatokun who was represented by a Principal Manager at the CBN, Mr. Joe Ogbogu said: “We endorse this because it would take our payment system to the next level. Nigeria is at the top pendulum of payment system in the whole world. And because of this, various countries come to understudy our payment system and this is one product I hope they would understudy in the near future.

“Another reason for this endorsement is that it is going to drive our financial inclusion. We have have challenges of acceptance of POS transactions because they don’t get instant value for their services some cases the next. With this product, merchants get instant value which is a big plus.”

He further added: ” I am sure this product would drive financial inclusion to level the it is desired. We have projected that by 2020, Nigeria should be able to get inclusion level of 80 percent and I’m sure this is one of the initiatives that would drive that.”

Speaking on behalf of the banks, the Chairman Committee of E-banking Heads, Mr. Dele Adeyinka said: “As an association, we have a timeline that says we want to drive excellence through collaboration and for banks who are always looking for opportunities to serve our customers better.”

Also Head mobile financial services Etisalat, Mr. Seun Omotosho said: “We at Etisalat are excited about this solution and all all of us have heard on what is happening in east Africa with Mpesa and co and we believe this is going to rival this. We are going the direction of payment because we believe payment is what will drive inclusion. This solution is simple and addresses what customers need.”

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Finance

Federal Government Clears $120m Debt to Gas Companies Amid Nigeria’s Power Crisis

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Amidst Nigeria’s persistent power crisis, the Federal Government has taken a pivotal step forward by clearing a significant portion of its debt to gas companies.

A sum of $120 million has been paid out of the country’s $1.3 billion indebtedness to gas suppliers, offering a glimmer of hope for improved energy stability across the nation.

The Minister of Power, Chief Adebayo Adelabu, underscored the critical role of gas in power generation and highlighted how the mounting debts had severely hampered gas supply to electricity-generating companies, exacerbating the country’s electricity shortfall.

Nigeria heavily relies on thermal power plants fueled by gas for over 70% of its electricity needs, making the timely settlement of gas debts paramount for enhancing power generation capacity and addressing the nation’s energy deficit.

Addressing delegates at the 7th Nigeria International Energy Summit in Abuja, the Director of the Decade of Gas Secretariat, Ed Ubong, expressed optimism about the government’s progress in offsetting its financial obligations to gas producers.

He emphasized the importance of aligning gas and power sectors to foster sustainable energy solutions.

As Nigeria grapples with the multifaceted challenges plaguing its energy landscape, the government’s commitment to settling outstanding gas debts marks a pivotal stride towards revitalizing the country’s power infrastructure and ensuring reliable electricity access for its citizens.

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Finance

Nigeria Insurance Corporation Reimburses Depositors of 179 Closed Microfinance and Four Mortgage Banks

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The Nigeria Insurance Corporation (NDIC) has announced the successful reimbursement of depositors affected by the closure of 179 microfinance banks and four mortgage banks across the country.

The reassuring news came during the 45th Kaduna International Trade Fair, where NDIC’s Managing Director, Dr. Bello Hassan, explained the corporation’s unwavering commitment to safeguarding depositors’ funds amidst financial uncertainties.

Dr. Hassan, represented by Hauwa Gambo, the NDIC’s Deputy Director of Communication, highlighted the corporation’s proactive measures in protecting the interests of depositors.

The introduction of the Single Customer View framework has expedited the process of reimbursing depositors of liquidated banks, ensuring swift and transparent transactions.

The corporation’s collaboration with the judiciary has yielded positive results, facilitating the speedy prosecution of failed insured banks and resolving long-standing cases of bank liquidations like Fortune and Triumph Banks.

This concerted effort has significantly enhanced the debt recovery rate, enabling NDIC to declare full liquidation dividends to uninsured depositors of over 20 deposit money banks.

Furthermore, NDIC has embraced digital remote payment strategies, streamlining electronic funds transfers to verified depositors’ alternate bank accounts.

The introduction of the ‘Deposit Tracer’ initiative in partnership with mobile operators aims to address apathy among depositors with small balances, providing accessible avenues for claiming funds trapped in closed banks.

The initiatives underscore NDIC’s proactive stance in safeguarding depositors’ interests and ensuring financial stability in Nigeria’s banking sector.

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Banking Sector

85.51 Million Nigerian Bank Customers Face Withdrawal Freeze Over NIN, BVN Deadline

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First Bank

As the March 1 deadline looms, an estimated 85.51 million Nigerian bank customers are facing the possibility of frozen accounts due to their failure to link their National Identification Numbers (NINs) and/or Bank Verification Numbers (BVNs) to their accounts.

Recent findings reveal the potential scale of the impending banking crisis.

Data from the Nigeria Inter-Bank Settlement System (NIBSS) indicates that Nigeria had approximately 146 million active individual bank customers as of December 2022.

However, by January 26, 2024, only 60.49 million BVNs were recorded on the NIBSS portal, leaving a significant portion unlinked.

Meanwhile, about 104 million NINs had been issued by December 2023, highlighting the disparity between NIN issuance and BVN linkage.

The Central Bank of Nigeria (CBN) had earlier issued directives to banks, mandating them to restrict transactions on accounts lacking linked NINs and BVNs, with effect from March 1, 2024.

Any accounts found non-compliant risk being designated as ‘Post no Debit,’ rendering them unable to process further transactions.

Responding to the impending crisis, the Director-General of the National Identification Management Commission (NIMC), Abisoye Coker-Odusote, emphasized the need for the revalidation of Front-End Partners (FEPs) to ensure the integrity of the identity database.

She underscored the importance of NIN registration and urged collaboration with various stakeholders to expedite the process.

The Executive Vice Chairman/CEO of the Nigerian Communications Commission (NCC), Dr. Aminu Maida, reiterated the significance of linking NINs to SIM cards to enhance national security.

Telecom subscribers were urged to comply with the NIN-SIM linkage directive to avoid service disruptions.

Meanwhile, financial service providers like Opay have issued reminders of the impending restrictions, urging customers to comply with the linkage requirements.

Amidst concerns, some customers contemplate transferring funds to compliant accounts to avoid potential financial setbacks.

As the deadline approaches, stakeholders are intensifying efforts to mitigate the impact of the impending banking crisis on millions of Nigerians.

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