Ashaye: Nigeria Will Overcome its Economic Challenges
The Country Manager, sub-Saharan Africa, Visa Incorporated, Mr. Ade Ashaye, in this interview with Obinna Chima, expressed confidence in the Nigerian economy, saying that his firm would continue to partner with stakeholders in the economy in developing so
Our role as enablers is to enable innovations and if you got a problem that needs to be solved and a finger print solves that problem over a pin, then we need to be able to help you achieve that. For us, it is a story. We don’t have all the answers, all we do is to have a platform that shows that the developers and people are trying to solve a problem and we work hand-in-hand with our partners to create a solution that really solves the problem. Also, in terms of the argument that the physical cash is no longer as important as the card details, that is because we have moved into digital payments. e-Commerce transactions are growing up to three times the rate of face-to-face transactions and you don’t need physical cash for e-Commerce transactions. Mobile transactions are growing even faster than the rate of e-Commerce transactions and you don’t need physical cash. So, it is not that the physical cash are not important; it is the data that is important.
I think you will see over the next couple of months, there would some new items. I talked about contactless payment. Today, we have given our Olympic ambassadors rings and those rings replaced the need for a card. With that, you can initiate contactless payment. I have my eyes on the mobile banking space. It is really interesting how Nigeria and Africa generally, defers from some of the more developed markets. More than 65 per cent of our retail purchases are made here, even in the open market. And the economics of having a point of sale (PoS) in the open market is very different from having it in a shopping mall. That means the solutions need to be different. That was what I spoke about when I said we need to work with local partners to develop solutions that make sense locally. So, for the unbanked population, the solution is to develop solutions to address the needs in such an area. So, if our problem is that a large proportion of our consumers are in the rural area, we would look at how they connect, the solutions and the opportunities. We also need to work with the providers to ensure that the solutions they need are being developed.
I think what happened was that we have seen a number of banks place some restrictions, like some say you can use your naira cards locally, but you can’t use them abroad. So, that is changing the way people are able to pay. It is impacting everybody, most especially our banks. But the cards still work locally and we are seeing growth in domestic transactions. People are getting used to the idea of using their cards to make payments locally. We are all struggling right now; we are all in a situation where Nigeria is not where it used to be, but the economy will surely overcome its challenges. Every economy goes through a cycle. We are not here for the short-term, we are here for the long-term. We are not here just for ourselves, but we are here to help everybody. We would continue to help people develop solutions that solve the problem that they want to solve and we would continue to grow together.
Honestly I believe that the banks talk about the benefits and the fact that you can identify these individuals across multiple banks as individual bank. But I think we are yet to see the real full benefits. What is the ability for lend to an individual when he has a better understanding of that individual’s exposure across the banking industry? So, the ability to lend is going to drive greater volume of transactions. So, these are some of the types of benefits I am really looking forward to seeing.
Visa believes the most important financial tool is knowledge. That is why for over a decade Visa has been developing financial literacy programs that teach individuals how to spend, save and budget responsibly. Supporting financial literacy is both good for our business and the right thing to do. Visa’s global financial literacy initiative is localised across more than 30 countries and in 2009, Visa pledged to reach 20 million people through financial literacy education by 2013-a goal surpassed one year ahead of schedule in May 2012. We’re now approaching 30 million people that have been reached by our by our financial literacy initiative. As a global payment technology company, we see one of the most valuable contributions we can make as helping to bring more people into the formal financial system. We do so by creating pathways to financial inclusion for the financially underserved through our products, services, technology, and payments expertise; financial literacy tools and resources; and our strategic partnerships. We believe access to financial services is essential for progress. Financial inclusion moves people from being underserved and isolated members of our economic system to thriving and contributing participants. Improving access to financial services and electronic payments is a critical building block to help more people improve their lives and lift themselves out of poverty. Given the appetite to increase financial service penetration coupled with the government and CBN focus on supporting the advancement of financial inclusion, Nigeria has been identified as a key strategic country for many private sector companies and organisations that are committed to advancing financial inclusion.