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Ghana’s Digital Infrastructure Achieves 100 Percent Financial Inclusion, Ranks Number One in Africa

Ghana’s digital infrastructure has reportedly achieved 100 percent financial inclusion, the only country in Africa to achieve this feat.

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Following its government digitization agenda in 2017, Ghana’s digital infrastructure has reportedly achieved 100 percent financial inclusion, the only country in Africa to achieve this feat.

Ghana was able to achieve this feat after the West African country, successfully implemented the Mobile Money Interoperability (MMI) system. A system that integrates all payments platforms across telcos, fintechs and banks, enabling its citizens to make and receive instant payments.

Commenting on the country’s recent achievement of 100 percent financial inclusion,  Ghana’s vice president Mahamudu Bawumia said, “In fact, because of mobile money interoperability, where fintechs, banks, and telcos have essentially payment platforms that enable every Ghanaian to access and receive payments, Ghana was the only country to score 100% on financial inclusion in Africa at the ongoing Mobile World Congress Africa 2022 in Kigali, Rwanda.

“And it just makes you proud in this context that yes, we are doing what is actually quite right. You’ve seen mobile money interoperability; you’ve seen the national ID card; you’ve seen digital addresses, you’ve seen the paperless ports, universal QR code, Ghana pay, and so on.

“All of this is laying a particular foundation in this country that will allow us to fully participate in the Fourth Industrial Revolution. It is also comforting to note that even the credit reference agencies are leveraging on these infrastructures, the digital infrastructure that we have put in place, digital addresses, national ID, and so on.

“We are expecting that individual credit scoring by the credit reference agencies will start taking place by the first quarter of next year, which will allow and underpin the development of a real credit system in Ghana which is very, very critical in terms of the development of this country.”

Investors King understands that the government of Ghana began its digitization agenda in 2017 and has continuously employed the application of digital technology to stimulate the growth and transformation of the Ghanaian economy.

Through this agenda, the Ghanaian government also introduced some interventions such as mobile money interoperability, implementation of the digital address system, and digital renewal of National Health Insurance among others, which have significantly improved the economic and social lives of Ghanaians.

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Finance

Private Sector Credit Hits Record High of N76.94 Trillion in January 2024 – CBN Report

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Private employers

Private sector credit in Nigeria reached a record N76.94 trillion in January 2024, according to the latest report from the Central Bank of Nigeria (CBN).

This represents a 85.2% year-on-year increase from N41.54 trillion reported in January 2023.

The CBN’s Money and Credit Statistics report unveiled that credit to the private sector experienced a substantial month-on-month surge of 23.06%, or N14.42 trillion, from N62.52 trillion in December 2023.

This surge occurred amid the implementation of the CBN’s policy to unify the naira exchange rate.

Analysts attribute the reported N76.94 trillion credit to the private sector to the recent depreciation of the naira against foreign currencies.

The naira closed at N1,356.88 per dollar in January 2024, representing a 50.87% decline or N457.49 against the dollar compared to December 2023.

This depreciation compelled banks to extend credit to major corporations to meet the CBN’s mandated Loan-to-Deposit Ratio (LDR) threshold.

The CBN’s decision to resume the enforcement of the LDR policy, effective July 31, 2023, further propelled banks to increase lending to customers, stimulating the real sector of the economy.

With the CRR mechanism updated, banks with an LDR below the prescribed level faced a 50% lending shortfall penalty.

Experts suggest that the significant increase in private sector credit underscores the growing need for businesses to secure funds amidst economic uncertainties and exchange rate volatility.

It also signifies banks’ efforts to comply with regulatory requirements and support economic growth initiatives.

As Nigeria navigates its economic landscape, stakeholders anticipate further developments in credit dynamics and monetary policies to sustain financial stability and stimulate economic expansion.

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Loans

Senate Initiates Probe into N30tn Ways and Means Loans under Buhari Administration

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Muhammadu Buhari

The Nigerian Senate has embarked on a comprehensive investigation into the disbursement and utilization of the N30 trillion Ways and Means loans obtained by the Central Bank of Nigeria (CBN) during the administration of former President Muhammadu Buhari.

The Ways and Means facility allows the CBN to provide financial support to the government to cover budget shortfalls.

The decision to probe the massive loans comes amid concerns about the transparency and accountability surrounding the utilization of these funds, particularly as the country grapples with economic challenges, food crises, rising inflation, and worsening insecurity.

The Senate’s investigation aims to shed light on how the substantial overdrafts from the CBN were acquired and expended under the leadership of former President Buhari.

There is growing apprehension that the indiscriminate spending of the overdrafts, particularly during Godwin Emefiele’s tenure as CBN governor, may have contributed significantly to the current economic predicament facing the nation.

The probe will delve into the details of the N30 trillion overdrafts, with a specific focus on examining the purpose for which the funds were allocated and how they were utilized.

Also, the Senate will scrutinize the N10 trillion disbursed under the Anchor Borrowers Scheme, as well as the utilization of $2.4 billion out of the $7 billion earmarked for forex transactions.

The initiative underscores the Senate’s commitment to ensuring transparency, fiscal responsibility, and prudent financial management in the country’s economic affairs.

It is anticipated that the probe will unearth vital insights into the financial transactions of the past administration, enabling corrective measures to be taken to address any mismanagement or discrepancies discovered.

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Loans

Foreign Loans Dominate Nigeria’s 2023 Capital Importation, Hits $2.31bn – NBS Report

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US Dollar - Investorsking.com

In 2023, foreign loans dominated Nigeria’s capital importation, according to the latest report from the National Bureau of Statistics (NBS).

The report reveals that out of the total $3.91 billion foreign investment inflow, foreign loans accounted for $2.31 billion, representing 59.1% of the total capital importation.

The NBS data indicates a substantial increase in foreign capital inflow compared to previous quarters.

The final quarter of 2023 saw a notable surge, with foreign capital importation rising from $654.65 million in the third quarter to $1.09 billion.

This surge reflects increased investor confidence and interest in Nigeria’s economic prospects.

However, the dominance of foreign loans in the capital importation landscape raises concerns about Nigeria’s debt profile and sustainability.

While foreign loans can provide crucial funding for development projects and infrastructure, excessive reliance on borrowing poses risks to the country’s fiscal health and economic stability.

It underscores the urgent need for prudent debt management and strategies to diversify funding sources.

The breakdown of the capital importation further reveals that Nigeria received $433.87 million in the first quarter, $771.53 million in the second quarter, $507.71 million in the third quarter, and $594.75 million in the fourth quarter as foreign loans.

The report underscores the importance of addressing structural challenges and creating an enabling environment to attract diverse forms of foreign investment beyond loans.

It emphasizes the need for policies that promote sustainable economic growth, attract foreign direct investment, and reduce reliance on external borrowing.

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