Deep­en­ing Bank­ing through Fin­tech


Bank­ing in Nige­ria has taken so many tech­no­log­i­cal di­men­sions, in­no­va­tions, cre­ativ­ity and ease of car­ry­ing out fi­nan­cial trans­ac­tions, all evolv­ing as fi­nan­cial tech­nol­ogy (fin­tech) com­pa­nies.

Fin­tech is a new trend­ing in­no­va­tive tech­nol­ogy aimed at im­prov­ing ac­tiv­i­ties in the fi­nance in­dus­try. This in­clude: dig­i­tal­is­ing process, pro­cesses pre­vi­ously han­dled with pa­per money and hu­man trans­ac­tions.

The ad­vent of fin­tech could be at­trib­uted to the cash­less econ­omy pol­icy in­tro­duced by the Cen­tral Bank of Nige­ria (CBN).

The Pres­i­dent, Fin­tech As­so­ci­a­tion of Nige­ria, Dr Se­gun Aina, said there was no doubt that “Africa is be­com­ing the toast of global and lo­cal Fin­tech in­vestors as ev­i­dent by the vol­ume of funds be­ing chan­nelled into the con­ti­nent’s Fin­tech start-ups’’.

Aina, quot­ing Fi­nan­cial Fo­cus Jour­nal of PwC in Africa, said: “Fin­tech in­vest­ments are es­ti­mated to have in­creased by a Com­pound An­nual Growth Rate (CAGR) of over 58 per cent be­tween 2014 and 2016 to 800 mil­lion dol­lars.

“It can pos­si­bly be val­ued at three bil­lion dol­lars by 2020 with Nige­ria and South Africa re­ceiv­ing a sig­nif­i­cant por­tion of the in­vest­ments.

“Non-Gov­ern­men­tal Or­gan­i­sa­tions have also been re­lent­less in fund­ing in­no­va­tions in order to drive fi­nan­cial in­clu­sion in Sub-Sa­ha­ran Africa, thereby re­duc­ing poverty and en­gen­der­ing con­di­tions that im­prove liv­ing con­di­tions on the con­ti­nent.’’ he said.

Not only are fin­techs pro­vid­ing em­ploy­ment op­por­tu­ni­ties, but also boost­ing the na­tion`s econ­omy, es­pe­cially with the drive for 80 per cent fi­nan­cial in­clu­sion by 2020.

Also in its drive to achieve fi­nan­cial in­clu­sion, First Bank of Nige­ria (FBN) has fol­lowed up in the drive by pro­vid­ing var­i­ous plat­forms whereby over 12 mil­lion cus­tomers and still count­ing, have ac­cess to tech­no­log­i­cal in­no­va­tions to carry out their bank­ing trans­ac­tions.

The FBN, also through the tech­no­log­i­cal in­no­va­tions in­tro­duced into bank­ing (Fin­techs), em­pow­ered start-ups with unique in­no­va­tive ideas and cre­ated em­ploy­ment.

Fin­techs and fi­nan­cial in­clu­sion are in­ter­wo­ven and ma­jor in­gre­di­ents for suc­cess to be achieved in the fi­nance in­dus­try.

The FBN Man­ag­ing Di­rec­tor, Dr Ades­ola Ad­e­dun­tan, said at the launch of What­sapp Bank­ing that, as a lead­ing bank­ing ser­vices provider, FBN was de­ter­mined to of­fer sat­is­fac­tory fi­nan­cial ser­vices to cus­tomers by de­vis­ing ways of ef­fec­tively meet­ing their needs.

Ad­e­dun­tan said that the bank had op­ti­mised dig­i­tal bank­ing for con­ve­nience.

“Since we have 12.5 mil­lion cus­tomers with 20 bil­lion worth of trans­ac­tions monthly, it has be­come nec­es­sary for us to cre­ate new tech­nol­ogy in­no­va­tions to meet their needs.

“Our FirstMo­bile app, Firston­line, FirstMonie and USSD bank­ing are some of the chan­nels we have put in place to make this hap­pen.

“FirstBank Chat Bank­ing on What­sapp is our lat­est ad­di­tion. We have gone live with this prod­uct and we are pleased to for­mally in­tro­duce this prod­uct to our me­dia part­ners to­day,’’ he said.

The man­ag­ing di­rec­tor said that the app was an­other sig­nif­i­cant mile­stone in the bank’s mis­sion to pro­vide con­ve­nient and fast pay­ment so­lu­tions to its cus­tomers.

He said: “It is a new chan­nel for ac­cess to our ser­vices; a con­ve­nient way to make pay­ment and an easy-to-use bank­ing ap­pli­ca­tion.

“Bank­ing with FirstBank on What­sApp is se­cure, ac­ces­si­ble and con­ve­nient.

“You can now carry out ba­sic bank­ing trans­ac­tions such as in­ter and in­tra bank fund trans­fer, pay bills, buy air­time, buy data and check your ac­count bal­ance on your What­sApp.’’

Ad­e­dun­tan added that cus­tomers would be able to gen­er­ate a What­sApp bank­ing PIN to be able to carry out the trans­ac­tions.

He ex­plained that trans­ac­tion au­then­ti­ca­tion would be done us­ing a safe link, thereby en­sur­ing the se­cu­rity of bank­ing de­tails.

First Bank of Nige­ria had ear­lier or­gan­ised a `Hackathon’com­pe­ti­tion and re­warded star­tups with in­no­va­tive ideas that would boost or bring about ease of car­ry­ing out fi­nan­cial trans­ac­tions.

Mrs Fo­lake Ani -Mu­muney, Group Head, Mar­ket­ing and Cor­po­rate Com­mu­ni­ca­tions of FBN, said the event was con­vened to in­crease sup­port and col­lab­o­ra­tion with the tech­nol­ogy com­mu­nity and deepen the banks tech­no­log­i­cal in­clu­sion frame­work.

Ani-Mu­muney said that banks, to drive fi­nan­cial in­clu­sion, must struc­ture highly-rel­e­vant and sim­pli­fied fi­nan­cial so­lu­tions that meet the spe­cific needs of their cus­tomers at an af­ford­able cost.

She said that un­der­stand­ing cus­tomers’ needs be­fore push­ing out­tech­nol­ogy in­no­va­tions was very es­sen­tial.

An­other in­no­va­tion is the What­sapp bank­ing. It is a known fact that What­sapp is most widely used and fastest form of chat­ting and its in­tro­duc­tion into bank­ing had made bank­ing ac­ces­si­ble.

Mrs Lola Ekugo, Head, Dig­i­tal In­no­va­tion Lab, said: “We launched What­sapp bank­ing to serve our cus­tomers.

“What we are say­ing is that for our cus­tomers, we want con­ve­nience for them. What­sapp bank­ing is the most widely used chat­ting plat­form.

“You are al­ready car­ry­ing out con­ver­sa­tions on the What­sapp; so why not just bank.

“We are meet­ing our cus­tomers where they are; we are al­ready there.

“You can chat; you can carry out your trans­ac­tions or check your bal­ance; send money to your friends; buy air­time all on What­sapp.

“The What­sapp bank­ing is very friendly. We mod­eled it sim­i­lar to what we do on the Un­struc­tured Sup­ple­men­tary Ser­vice Data (USSD) plat­form.

“So in terms of charg­ing, we are not go­ing to charge any­more. For us, it is for con­ve­nience for our cus­tomers.

“Any­body can use it es­pe­cially if you are on What­sapp,’’

Ac­cord­ing to her, CBN gave a tar­get of 80 per cent fi­nan­cial in­clu­sion by 2020 and we as a bank, we are also think­ing about our cus­tomers.

“This will po­ten­tially al­low you to trans­act more. So, wher­ever you are or who­ever you are, as long as you have What­sapp, you can trans­act.

“We are work­ing to­ward fi­nan­cial in­clu­sion as well as how would it af­fect the econ­omy. Even the traders would be able to pay bills with­out leav­ing their stalls,’’ Ekugo said.

She said that those who could not use the What­sapp, could use the USSD so that the un­der-served can be fi­nan­cially in­cluded.

Ekugo said ac­ces­si­ble dig­i­tal chan­nels would pro­vide greater­con­ve­nience for cus­tomers at a lower cost for banks and also pro­vide so­lu­tions to chal­lenges re­lated to in­fra­struc­ture in the coun­try.

“We recog­nise the fact that some of our cus­tomers who have small phones, can­not use the app be­cause of the lim­i­ta­tion of data. That is why we have op­tions which our cus­tomers can key into to ac­cess fi­nan­cial ser­vices,’’ she said.

Mr Chuma Ezirim, a fi­nan­cial ex­pert, said that the What­sapp bank­ing was an en­cour­ag­ing in­no­va­tion that would en­able ac­tive bank­ing among cus­tomers.

Ac­cord­ing to him, it will also con­trib­ute to the econ­omy by get­ting those fi­nan­cially ex­cluded to be fi­nan­cially in­cluded.

Ezirim said that the only im­ped­i­ment of the chat bank­ing “is if a cus­tomer has a small phone or lim­ited data’’.

He said that in such a case, the other plat­forms could be ac­cessed.

“This would leave no doubt that not only is First Bank striv­ing to achieve fi­nan­cial in­clu­sion but also ren­der­ing Cor­po­rate So­cial Re­spon­si­bil­ity (CSR) through the “Hackathon’’ com­pe­ti­tion that em­pow­ered youths.

It is note­wor­thy that Fin­tech has come to stay to en­able banks and other fi­nan­cial ser­vices providers to pro­vide value-adding ser­vices to meet their nu­mer­ous cus­tomers’ in­creas­ing needs.

There is no doubt that Fin­tech will rev­o­lu­tionise the bank­ing and fi­nan­cial ser­vices de­liv­ery sys­tems and im­prove the way ser­vices are de­liv­ered to cus­tomers.

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