Need to have more money? Owning a Phone: How Mobile Banking is Revolutionizing Financial Inclusion in Nigeria.
If you need an urgent loan in Nigeria now, all you have to do is pull out your mobile phone and search and you’ll be inundated with offers, but that wasn’t always the case back then. .
When cell phones were introduced in Nigeria, one of the feelings they brought, beyond improved connectivity, was a sense of inclusion in the global economy. Despite the high costs of SIM cards and handsets (my first SIM card in 2001 was N25,000, when calls were priced at N50 per minute), this meant that I could now easily reach my cousins wherever they are in the world, a much more accessible service. means of communication than the old telephone network.
Fast forward 20 years later cell phones have gone from new to ubiquitous and helped propel the movement towards cashless payments I barely go out with much cash these days perhaps most important to the millions of Nigerians like me who struggle to improve their lives, it is access to financial services that are available to them.
One thing I read recently is that in 2020 the Central Bank of Nigeria presented a strategic roadmap and framework to improve ﬁnancial inclusion in Nigeria.
These initiatives include:
• Development of various ﬁnancial products;
• Improved payment processes;
• Development of the credit system; and
• Encouragement of a culture of savings
This makes more sense to me now, as I have seen a surge in microfinance institutions to help provide funding for personal or business needs. The microfinance model focuses primarily on providing financial services to low-income people, and it has been identified as a viable instrument to promote financial inclusion, so it is ideally suited for people looking to grow their SME.
There is evidence to show that it is already working, consider that in 2020 around 56 million (56%) Nigerian adults were unbanked, and in 2018 Enhancing Financial Innovation and Access (EFInA) put this figure at 60 million, this showed that in 2 years, about 4 million Nigerians were able to access financial services.
This is where the mobile phone has revolutionized ﬁnancial inclusion; according to Statista, Nigeria as of August 2021, 48% of the Nigerian population used a mobile device to access the internet. This number is expected to reach 59% by 2026.
One of the main drivers of this growth is the ever-increasing availability of mobile phones for low-income people and the services of financial institutions, especially microfinance designed for these low-income people.
The Letshego group, for example, in the markets where it is present, has created tailor-made services such as loans to SMEs which are aimed at people who previously could not access these services. What these services all have in common is that they are modeled in such a way as to ensure that low-income people are not exempted from benefiting from these services.
For example, from my phone, I used a USSD code *5104# to apply for loans by just following the prompts, and when I went online from the phone, I could just browse through the different loan options available, which which makes it much easier to get urgent loans than before by going to the bank and filling out countless forms.
So if it’s an urgent loan you need then the power is already in your hands, whether it’s a quick USSD code you want to enter or scrolling through the various offers of products, the choice is yours.