ABOUT 40% of the Nigerian population do not have access to financial services of any sort according to the managing director of the Nigeria Deposit Insurance Corporation (NDIC) Alhaji Umaru Ibrahim.
Regarded as a highly under-banked economy, Nigeria’s finance sector does not have sufficient liquidity to lend enough money to investors and entrepreneurs in a manner that would make a radical difference. In large parts of rural Nigeria, especially in the north of the country, there are no banks at all and people carry out commercial transactions in hard cash, in what is called an informal economy.
Warning that this creates liquidity problems, Alhaji Ibrahim said there is need to bring more people into the financial services net. many small artisans in Nigeria have no access to lending at all and even those that do, cannot afford the high interest rates which banks charge, which can sometimes be as high as 25%.
Speaking while receiving the Alumni Association of the Institute (AANI) which paid a courtesy visit on him at the head office of the corporation in Abuja, Alhaji Ibrahim disclosed that the NDIC was established in 1989 to promote public confidence in the banking industry. He added that it was also there to contribute to the stability of the financial system, as well as ensure an orderly resolution of failed financial institutions.
According to Alhaji Ibrahim, presently about 40% of Nigerians are either financial excluded or operate outside the formal financial system. He therefore urged the AANI to partner with the corporation to accelerate the pace of financial literacy and financial inclusion among the Nigerian public.
He disclosed that the NDIC, in close collaboration with the Central Bank of Nigeria will continue to support the introduction of affordable products and services not only to the general public but also to vulnerable women and rural dwellers. In furtherance of its elaborate initiatives towards achieving the desired level of financial inclusion in the country, the NDIC boss expressed the commitment of the corporation to support the introduction of new channels of providing financial services.
These will include agency banking, payments service banks and mobile banking among others, which will enable small depositors have access to financial services across the country. Alhaji Ibrahim called on the general public, especially retired senior public servants and retired bankers to acquire agency banking and micro finance banking licences in order to make modest contributions to the growth and promotion of these services in their respective communities.