Governor of Central Bank of Nigeria (CBN), Mr Godwin Emefiele has given the assurance that Nigeria will strive hard to meet the target of reducing the number of Nigerians not captured by the banking sector to 20 per cent by 2020.
Emefiele, who was exchanging views with visiting United Nations (UN) Special Advocate on Financial Inclusiveness, Queen Maxima of Netherlands, in his office on Wednesday, said although it is a very ambitious target, efforts would be made to meet it.
“Our target is to reach 20 per cent exclusion rate by 2010. Towards this, the Bank introduced a number of initiatives prominent among which is the Agent Banking Framework, tiered Know Your Customer Framework, Micro, Small and Medium Enterprise Borrower Programme, National Collateral Registry, Credit Bureau and Credit Scoring System, and the released Release of National Financial Literacy and Consumer Protection Framework.”
Already he said, “we have moved from 46.3 per cent exclusion rate in 2010 to 41.6 per cent in in 2016. To achieve the exclusion rate of 20 percent by 2020 across the country, we are aggressively focusing on the following areas: prioritising interventions and creating awareness to ensure patronage, incorporating non-interest financial services through the CBN intervention programmes and mobilizing banks that offer such products for greater outreach and impact; massively rolling out agent networks, and creating awareness to increase adoption and propagating digital financial services as simple, flexible and easy alternative channels for reaching remote areas and the rural hinterlands.
“In addition to the above, the National Financial Inclusion Strategy is being reviewed for greater effectiveness and impact with stakeholders sufficiently mobilized to participate.
“Here, I must note with gratitude, the sponsorship of The Bill and Melinda Gates Foundation for this work.
“Yes, we have moved from 46.3 per cent to 41.6 per cent exclusion rate in 2016, we consider this a modest movement and no doubt we still have a lot of work to do if we are to move from 41 percent to 20 per cent by 2020, I must confess that we have a lot of work to do and I can assure you that we would focus aggressively on this.”
The CBN Governor admitted that the country needed to “work on propagating digital financial services as simple, flexible and easy alternative channels for reaching our remote areas and rural hinterland.
“Through this medium we are thinking of aggressively working with Nigeria Communications Commission (NCC) through the use of mobile telephone. The subscription rate in the mobile telephone today is over 150 million and we believe that if it could work well with NCC, it will help us.
“We are therefore optimistic that in no distant future, substantial progress will be made in our efforts to achieve the 20 percent target.”
He however, expressed caution on some clamour for the country to rely on an all telecommunications approach of achieving the target instead of bank-led approach even though it has the potential to quickly achieve the target.
According to him, the bank led approach appears the best option for Nigeria in view of the potential challenges of its alternative.
“Telcos led approach poses certain risks, which must be addressed. Mitigants must be put in place to avoid financial losses.”
Responding, Queen Maxima said her office was more than prepared, very willing and committed to support Nigeria in this process with assistance and knowledge from abroad.
“We are also committed to include private sector stakeholders to move forward in this endeavor. Don’t think I have to tell you how important financial inclusion is for development, for broad growth and also for reducing inequality in the country and also the spillover effect this could actually have on the whole African continent given the importance of Nigeria.
“I’m very happy that the National Inclusion Strategy is being revised. We are aware of it and we have had a very good discussion with the private sector and also with NCC as well as with many other people involved in this issue.
“Let me say that you have very huge potential to quickly achieve your target. Mobile money has a very good potential. We will like to have a conversation with you on how to involve telecom companies pay a role in payment and transfer services.”