On the global spectrum, there have been long-standing problems with adults who don’t have their own bank accounts be it due to a lack of accessibility, need or otherwise. For many, as a result of the ‘financial exclusivity’ associated with much of banking, the unbanked resort to alternatives. Before, the other options didn’t necessarily seem appealing, but now the unbanked options are a bit more glamorous through bitcoin and startup programs, giving users a lot of the financial services our typical banking institutions do via a different means.
The unbanking issue isn’t a new problem for Nigeria or Africa as a whole, but it is disrupting our potential economic growth. By adopting a more financially inclusive approach in our banking system, we open the door for exponential growth within this nearly untapped sector. As reported in Forbes, “Banks could add $380 billion annually in revenue in emerging markets alone by reaching out to the un/underbanked, according to Accenture estimates. The biggest opportunities in emerging markets are in Brazil, India, Mexico, Nigeria, Vietnam and South Africa.” Aside from the profits, this expanded service also has the potential to strengthen the middle class and in turn our national economy. It seems obvious.
All this is not to say there hasn’t been a lot of progress. As reported on Vanguard, “The global pursuit of financial inclusion as a vehicle for economic development had a positive effect in Nigeria as the exclusion rate reduced from 53 percent in 2008 to 46.3 percent in 2010.” This trend has continued into 2018. Earlier this year the Central Bank of Nigeria announced financial service targets to keep Nigeria on track for an 80% financial inclusion rate by the year 2020 as reported here.
We also shouldn’t devalue the alternative approaches either. As Bunmi Coker says, “In line with this [projected widespread adoption of digital finance opportunities], a number of fintech companies have over the past couple of years emerged in the Nigerian space to provide digital financial services that include payments, transfers, purchasing, lending, investing/borrowing and switching.” Our primary goal is financial inclusion and accessibility, and while financing startups and cryptocurrency remain a bit unconventional, they too hold promise for Nigeria and our economy.