By making financial services open at moderate expenses to all people and organizations, regardless of total assets and size, financial inclusion aims to deliver answers for the requirements that exclude individuals from participating in the financial sector. You would concur that nations with more profound degrees of financial inclusion have more grounded GDP development rates and lower-income disparity.
According to the EFINA report, Access to Financial Services survey findings released, revealed that 36.8% of the adult population in the country is financially excluded. According to regulators and other key players in the economy, the survey also showed that Nigeria has a chance to achieve the 20% exclusion rate target for adults by 2020. This translates to a population of 36.6 million adult Nigerians who are excluded, with 44.1% male and 55.9% female.
Also, Nigeria had a total adult population of 99.6 million, with 39.8% as the banked population which translates to 39.7 million. The unbanked population is 60.1 million with 71.3% of mobile phone users that are adults among the excluded. From the analysis, 63.3% of the population is financially served with 38.7% in the banked category (39.5 million). This suggests in outright terms, that Nigeria still has a huge unbanked populace, hence the CBN financial inclusion goals.
The patterns and behaviors poor households’ exhibit around financial management sheds light on the complex financial lives they lead to survive on variable low incomes. While the federal government and CBN are focused on access to credit, poor and marginalized groups require access to a full range of financial services to effectively manage their economic lives. Financial inclusion growth tools in a diverse country like Nigeria in recent times must hence be identified as a spectrum of progress, to encapsulate the different dimensions of the populations they have serviced.
THE TRADER MONI PROGRAM
Armed with the knowledge that millions of Nigerians, at the base of the economic pyramid lacked access to credit facilities in 2016, the Federal Government initiated the Government Enterprise and Empowerment Program (GEEP). Also, in the quest to support the 20 million petty traders in Nigeria who are in dire need of capital to expand but are unable to access loans to trade, the government introduced TraderMoni, one of three microcredit products of GEEP.
The TraderMoni scheme is a collateral-free loan program which allows petty traders the opportunity to access an initial capital of N10,000 which upon successful repayment, grows into an interest-free credit up to the sum of N300000.
According to Vice President, Prof. Yemi Osinbajo, SAN, at the 23rd Convocation Ceremony of the Lagos State University, LASU – “A greater challenge was when we started our TraderMoni microcredit loans to reach two million petty traders across the country. We didn’t look beyond young Nigerian innovators. He added that the first challenge was on how to enumerate two million petty traders; we got two Nigerian technology based companies MobileForms and Generating Demand Management Group (GDM). MobileForms was founded barely three years ago by two young Nigerian graduates, Damilola Ayorinde and Oluwatomi Ayorinde.
The company has created a platform that enables businesses and governments to crowdsource data from across the African Continent. These young Nigerian entrepreneurs delivered the largest Social Investment Programs of their kind in Africa faultlessly.” The primary problem was the accessibility to the petty traders by way of properly documenting their biodata being that the petty traders had limited education, hence there was not enough information about them or financial history.
With the MobileForms application, an electronic form application that functions on a smartphone or tablet device, which enables users to collect data using mobile devices, CrowdForce enabled the creation of digital identities to over 2 million petty traders across Nigeria under the federal government’s TraderMoni project by employing over 100,000 agents in all 774 local governments in Nigeria to carry out its market research activities.
On the TraderMoni project, CrowdForce facilitated services like digital lending, loan disbursement, and recovery. Mobile Forms was developed by a team of engineers at CrowdForce with a very simple goal; to empower youths, retailers and business owners with opportunities to make extra income to improve their lives. Youths are empowered to work as agents in enumerating retailers who become beneficiaries of government and NGO initiatives like TraderMoni. Business owners are armed with the data to test the market by way of researching product-market fit, the purchasing power of the target market and so on.
According to Uzoma Nwagba, the Chief Operating Officer of GEEP, the operation of the program does not mirror its target demographics. He stressed that “the more illiterate or unsophisticated our beneficiaries are, the more sophisticated our operation has to be. All the complexity must be absorbed by us and taken out of the trader’s experience. We have a highly technology-driven program.” Agents who use the Mobile Forms initiative on the field confess that it makes it easier for them to seamlessly register, gather information and on-board the TraderMoni beneficiaries.”
“MobileForms, thank you for the payment today… for me, the traders’ payment is much more important to me because that’s why I did the enumeration for them. I want them to benefit like the previous social investment programs,” Emmanuel Oluwafemi?, an agent with CrowdForce, said.
This was affirmed by Coleman Damilola?, another agent on the CrowdForce platform who had been out of a job for a couple of months, his joy was evident as he declared “special thanks to Mobile Forms Limited, a job of one month earned me an N135100 salary.”
Although massive strides have been taken in the race for financial inclusion, there remains more to be done. For example, during the TraderMoni enumeration scheme, data on 2.5 million traders were captured and only a minuscule 16,000 had functional Bank Verification Numbers (an 11-digit number that uniquely identifies every customer across the Nigeria Banking industry using biometric details).
The Central Bank of Nigeria has a financial inclusion strategy that targets above 500,000 financial access points as well as a financial exclusion rate 0f 20% in Nigeria by 2020. Currently, many financial servicing companies are serving this market and Crowdforce is not left out as they also have a solution for this, called Payforce.
The lack of access to formal banking in the mass market in Africa has opened the door for technology driven companies to build successful mobile payment services. Capitalizing on the phenomenal number of agents under Crowdforce, the company developed Payforce to actively deploy mobile banking services to tap the demand from the large unbanked population in Nigeria. There is strong evidence that their services have improved access to formal financial services in Nigeria. Crowdforce’s PayForce Agent Network helps banks and Fintech start-ups with the right network to scale, render digital services and capture digital identities via local merchant stores. It enables people to digitally send and receive money, and by creating simple financial access for the unbanked and the underserved population across Nigeria. Payforce has records of over N2billion daily transactions with 687active agents spread across Nigeria. As a CBN licensed Super-agent Company, Crowdforce aims to cover more places in Africa.
The importance of data goes way beyond decision-making and optimization. It goes as far as impacting the inclusivity and journey that Nigerian economy will take.