- Digital Finance to Boost GDP by $3.7tr
Broadening access to digital finance tools could increase Nigeria’s and other developing countries’ gross domestic product (GDP) by an estimated $3.7 trillion, a market leader in the e-payment industry, Global Accelerex, has said.
The firm however lamented that a combination of factors such as low income level, large rural population, financial illiteracy, poor coverage by banks, unprofitability for traditional banking and lack of innovation by financial institutions have continued to promote financial exclusion in the country.
Its CEO, Tunde Ogungbade, who spoke on: Digital Payment: Prospects and Challenges of a Financially Inclusive Nigeria in Lagos at Nigeria Information Technology Reporters Association (NITRA’s) Third Quarterly Seminar in Lagos at the weekend, said digital payment will help manage money more effectively with new ways to save, make payments, access credit, or obtain insurance.
According to him, people will spend less time taking care of simple financial transactions and more on productive work or running a small business of their own, adding that digital financial services increases consumer activity and trade
He said the Financial Access Survey (FAS) 2017 data show progress in some of the indicators of the Sustainable Development Goals (SDGs) and innovations in financial access, such as mobile making inroads, Automated Teller Machines (ATMs) which increased the use of digitalised payment from 11.49 in 2012 to 16.73 in 2016 per 100,000 adults.
According to him, the data also showed reduction in the number of physical traditional bank branches from 5.81 in 2012 to 5.36 in 2016 per 100, 000 adults, adding that it showed there had been level of adoption in digitalised mobile money payment indicating 34.26 per 1000 adults.
He said the percentage of adult Nigerians that do not have access to financial services fell from 46.3 per cent in 2010 to 39.7 per cent and it is expected to fall to 20 per cent in 2020.
He said at least 70per cent of adult Nigerians should have access to payment services in 2020 while 60per cent should have access to savings and 40 per cent each to credit, insurance and pensions by 2020.
“Channels through which people can access the services such as branches of banks, microfinance banks, number of ATMs, mobile agents, PoS, agents of deposit money banks are also expected to increase to specified target numbers per 100,000 adults in 2020,” he said.
According to him, there are three major stakeholders in the National Financial Inclusion Strategy (NFIS). These are the providers: financial institutions and partner infrastructure and technology providers; enablers: regulators and public institutions responsible for setting regulations and policies in respect of financial inclusion; partners and experts: supporters of Nigeria in meeting its economic objectives and delivering on their technical assistance mandates.
All these stakeholders are put together in the execution of the strategies to tackle financial inclusion in Nigeria, he said.
