NEWS Financial inclusion rate in Nigeria now 63.2%

After a dip in the financial inclusion headline number in 2016, the biannual financial inclusion survey shows a marginal increase from 58.4 percent in 2016 to 63.2 per cent in 2018, the Central Bank of Nigeria financial inclusion report has shown.

The report also disaggregated financial inclusion data on state-by-state level for the first time.

According to the report, whilst the data showed significant improvement in the North West and North East zones, the two zones remained more disproportionally excluded than any other zone at 62 percent and 55 percent exclusion rates respectively.

It noted that the Southwest remained the only region to have surpassed the targeted 20 per cent exclusion rate, with 19 percent recorded in 2018.

The Central Bank of Nigeria (CBN) noted that in addition to being a measurement year, 2018 can be described as a very important year that brought a massive shift in financial inclusion policy approach.

The report noted that the first National Financial Inclusion Strategy was revised to address changes in the regulatory and technology landscape with a view to accelerate the achievement of the strategic objective of 80 per cent financial inclusion by year 2020.

As a direct offshoot of the revised strategy, CBN issued a Payment Service Bank (PSB) Licensing and Regulatory framework, in line with the NFIS 2.0 principle of providing a level nontraditional player like the Telco’s, Fast Moving Consumer Good companies (FMCGs) and all entities with large distribution network to leverage on their existing structure and provide financial services for the unbanked.

According to the report, one issue that has bedeviled the penetration of financial services to underserved areas is insufficient fixed location agents.

Thus, to achieve the financial inclusion target of 80 percent by 2020, Nigeria requires 62 agents per 100,000 adults of which as at December 2017only 28.2 agents per 100,000 adults were recorded.

It explained further that to address this issue, the Body of Bank Chief Executive Officers (CEOs) and the CBN set up the Shared Agent Network Expansion Facility (SANEF), which has amongst other objectives, the mandate to increase agent network by half a million by 2020.

Most of these agents would be located in areas with high unbanked populations like the North West and North East regions.

On MSMEs access to credit and financial inclusion, the report noted that addressing MSME Credit Gap through development finance interventions based on the objective of financial inclusion in Nigeria, to achieve 80 per cent Financial inclusion, it is expected that credit penetration should be at 40 per cent by the year 2020.