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Digital Finance to Boost GDP by $3.7tr

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fintech - Investors King
  • 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.

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.

Fintech

Flutterwave Celebrates Inclusion in CNBC’s Top 250 Global Fintechs

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Flutterwave has been recognized as one of the Top 250 Fintech companies globally by CNBC and Statista.

Joining the ranks of industry giants like Ali Pay, Klarna, Piggyvest, and Mastercard, this accolade underscores Flutterwave’s impact on the financial technology sector.

This honor follows Flutterwave’s recent inclusion in Fast Company’s Most Innovative Companies list, highlighting the company’s pivotal role in transforming Africa’s payment landscape.

The recognition is a testament to Flutterwave’s dedication to innovation and excellence in providing seamless payment solutions across the continent.

Expressing gratitude, Flutterwave acknowledged its talented team, supportive board, reliable partners, and loyal customers for contributing to this success.

The company continues to drive progress in the fintech industry, reinforcing its commitment to enhancing financial accessibility and inclusion in Africa and beyond.

Flutterwave’s recognition on these prestigious lists marks a proud moment and a significant milestone in its journey, reflecting the company’s growing influence and leadership in the global fintech arena.

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Startups

Google Leads $250 Million Funding Round for Glance

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A logo is pictured at Google's European Engineering Center in Zurich

Google is leading a $250 million funding round for Glance, a mobile content provider.

This infusion of capital aims to expand Glance’s reach and solidify its market position amidst growing competition.

Glance, a subsidiary of InMobi Group, offers a unique service that delivers news, entertainment, and other content directly to users’ mobile screens without unlocking their devices.

With a user base exceeding 300 million across India, the US, Japan, and Indonesia, the startup has gained significant traction since its inception in 2019.

The funding round, expected to close in the coming weeks, marks a continued partnership between Google and Glance.

Google initially invested in the company in 2020, and this latest round will further enhance Glance’s capabilities to innovate and reach new audiences.

This investment reflects Google’s strategic interest in India, the world’s most populous nation, where it competes with tech giants like Microsoft, Meta, and Amazon.

With India’s rapidly growing middle class and increasing smartphone adoption, the market presents vast opportunities for digital expansion.

The support from Google comes on the heels of a previous $200 million investment by Mukesh Ambani, Asia’s wealthiest individual, which valued Glance at over $1 billion.

The startup’s largest stakeholder, InMobi, continues to thrive as a pioneer in mobile advertising, with Glance benefiting from its expertise and resources.

As Glance prepares for this new phase of growth, it stands poised to redefine how content is consumed on mobile devices worldwide.

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Technology

Cyber Threats Surge as Nigeria’s Digital Economy Expands

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As Nigeria’s digital economy flourishes, it faces escalating cyber threats, prompting the Federal Government to issue 33 cyberattack advisories in the past year.

These warnings, issued by the Nigeria Computer and Emergency Response Team (ngCERT), highlight the growing vulnerability of the nation’s digital infrastructure.

Since July 2023, ngCERT has alerted Nigerians to new attack methods and vulnerabilities. With 22 advisories issued in 2024 alone, the surge in cyberattacks coincides with the accelerated digitization spurred by the COVID-19 pandemic.

Monthly internet usage in Nigeria soared from 125,149.86 terabytes in December 2019 to 753,388.77 terabytes in March 2024.

The National Information Technology Development Agency (NITDA) notes that increased digitalization has heightened cybersecurity risks, necessitating robust protective measures.

According to Check Point Research, Nigerian businesses face approximately 2,308 attacks weekly across all sectors.

The advisories reveal various cyber threats, including ransomware and banking trojans. A recent warning highlighted Grandoreiro, a malware targeting over 1,500 banks globally, affecting 41 banking applications in Nigeria alone.

These attacks aim to steal sensitive financial data, potentially causing significant financial losses.

Nigeria’s critical infrastructure is also under threat. In August, pro-Nigerien hackers attempted to disrupt MTN Nigeria’s network, although they were unsuccessful.

During the 2023 elections, the government recorded 12.99 million cyberattacks, underscoring the scale of the threat.

Cybercrime costs Nigeria about $500 million annually. This includes data damage, stolen money, lost productivity, and post-attack disruptions.

The Federal Bureau of Investigation ranked Nigeria as the 16th country worst affected by cybercrime in 2020.

Experts emphasize the need for stronger cybersecurity measures. Adesina Sodiya, a professor of Computer Science and Information Security, warns that cyberattacks will continue to grow in sophistication.

He stresses the importance of building a cybersecurity curriculum and involving experts in creating effective strategies.

In response, NITDA plans to reduce cyberattacks by 40% by 2027. “As we digitize, we must build with security in mind,” said Kashifu Inuwa, director-general of NITDA.

The agency aims to implement comprehensive strategies to protect Nigeria’s burgeoning digital economy.

As Nigeria’s digital economy expands, it must address the growing cyber threats that accompany this progress. By enhancing cybersecurity measures and fostering collaboration among stakeholders, Nigeria can safeguard its digital future.

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