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IFC traces failure of financial inclusion to CBN’s 2009 Mobile Money guidelines

Leading international financial services group, the International Finance Corporation (IFC), has traced the rather too sluggish speed of financial inclusion in Nigeria to the mistake made by the Central Bank of Nigeria (CBN) in crafting its Mobile Money guidelines of 2009.

Giving clearer insights in a report titled: ‘Digital Access: The Future of Financial Inclusion in Africa’, it said the number of financially excluded people in Nigeria increased by 2.1per cent in 2017 to 40.1 million due to the fact that the said guidelines barred mobile operators from offering mobile money products.

IFC argued further that the little observed growth in mobile money has no direct link to the 2009 guidelines, but the principal drivers had been computerisation enforcement steps so far taken by the government and the tax amnesty and not mobile money.

Additional details showed that the number of mobile money accounts expanded by just six per cent in Nigeria in 2017, compared with double-digit growth in many jurisdictions.

The report therefore blamed the apex bank for following a wrong direction while introducing mobile money, saying failure stemmed from awarding operating licenses to companies ranging from retail banks to financial technology firms instead of telecoms.

While agreeing that the target to reduce the excluded ratio to 20 per cent of Nigerian adults by 2020 looks highly ambitious, IFC report averred that its findings were very similar to those of the leading domestic body, Enhancing Financial Innovation and Access (EFInA).

Otherwise, EFInA’s latest annual report found that 40.1 million Nigerians were financially excluded, representing a 41.6 per cent share of the adult population.

It said the definition of the included covered those who were banked, or had other formal arrangements and operated through the informal economy.

In a recent workshop organized by E-Payment Providers of Nigeria (EPPAN) in Lagos, participants drawn from the industry and the media agreed that much efforts need to be done by payment providers to reach the high number of the unbanked in the society by coming up with attractive and flexible products.

Besides, time has come for the government to review the 2009 guidelines so as to allow telecoms to drive the scheme as done in both Ghana and Kenya where financial inclusion is blazing with high speed.

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