•Report: Nigeria’s financial inclusion hits 74% in 2023
Nume Ekeghe
The Governor of the Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso, has issued a call to action for all stakeholders, specifically financial institutions, for more commitment to enhance Nigeria’s financial inclusion goals.
Cardoso, made the call at the Access to Financial Services in Nigeria (A2F) 2023 survey launch in Lagos, yesterday.
This was just as the Enhancing Financial Innovation and Access (EFInA), revealed an increase in Nigeria’s financially included population from 68 per cent in 2020, to 74 per cent for 2023.
The research manager at EFInA, Oluwatomi Eromosele, who revealed the figures noted that the initial figure of financial inclusion for 2020, was updated from 64 per cent to 68 per cent, due to updated data received from the National Census Commission.
However, Cardoso who was represented by the Director, Other Financial Institutions Supervision Department, CBN, Chibuike Nwagerue, said in order for the central bank to achieve its target of 95 per cent financial inclusion in 2024, there must be increased dedication of stakeholders in the financial systems ecosystem.
He said: “Let me use this opportunity to commend all financial inclusion stakeholders once again for efforts made and the progress achieved. However, to achieve the target of 95 per cent financial inclusion, we must all move from collaboration to concrete commitment.
“To that effect, I call on all financial inclusion implementation agencies to set up specific functions or units dedicated to financial inclusion in their various organisations. This we believe, will provide the necessary ownership and commitment required to achieve our collective goal.”
He added: “As data is the main crux of this event, let me mention that the bank would continue to leverage data for policymaking and to strengthen monetary policy transmission. I call on all stakeholders to come up with a framework that will leverage data for all financial inclusion-related efforts going forward.”
He noted that the Nigerian financial system has evolved with significant improvements in size and depth, especially in the areas of market development, products, instruments and payment infrastructure, among other things, thus, reinforcing the need for regulators and stakeholders to constantly keep pace with these emerging developments in a sustainable manner.
He added: “As we aspire to build a strong and broad-based economy, our focus must be to ensure that the economy can promote growth, efficiency, stability, and inclusiveness in the distribution of the gains of financial development.
“There is no doubt that stakeholders’ optimism is high and that these efforts would translate into accomplished objectives.”
He, however, noted that despite efforts in enhancing financial inclusion, some demographics like women, youth, MSMEs, and Nigerians in rural areas and the northern regions remained disproportionately excluded.
“We are confident that efforts by stakeholders to address these gaps in the past two years will show some improvement.
“Financial Inclusion stakeholders in the Insurance, Pension, and capital market space have developed relevant policies to address these economic shocks in the MSME sector of the economy.
“An inclusive and sustainable economy is hinged on two factors: inclusivity, ensuring that the economy works for everyone and sustainability ensuring the protection of the economy for the future.
“These two factors are critical in developing macroeconomic policies in the country, underscoring the importance of inclusive growth, both in the short run and the long run.
“Sustainable economic practices contribute to long-term economic resilience. This provides the backdrop for key interconnected elements in the broader economic development framework like Gross Domestic Product growth, inflation reduction, and price stability,” he added.
The CBN governor further said: “Inclusive financial systems play a crucial role in protecting the most vulnerable individuals and communities from the impacts of global uncertainties by always providing them with access to essential financial services. “Inclusive financial systems can offer protection through the provision of access to savings and emergency funds, the provision of rails to facilitate digital payments and transfers, and the provision of pathways to access credit, microloans, and social safety disbursements in times of crisis among other things.”
Continuing, Eromosele, who is the research manager at EFInA said: “Access to financial services, and financial inclusion has increased from 68 per cent in 2020 to 74 per cent, in 2023.
“Now, that number of 68 per cent is the updated adjusted number for 2020. We all know that in Nigeria, the very last survey that we have of access to financial services in Nigeria was done in 2006. “That means that the only opportunity that we have had to understand the Nigerian population and to demarcate and segment it was done in 2006.
“This is 17 years later, if we continue to try to understand the Nigerian population today, based on data that was gotten in 2006, we will be wrong.
“Recently in preparation for the 2023 census, the National Population Commission has come up with new data so they’ve gone across the country and they’ve come you know, come up with a sample that then shows us that Nigeria is now more urban than it was in 2006.
“Financial inclusion is an indicator, which we always know is urban bias. So, in other words, as population becomes increasingly urban, financial inclusion is likely to increase.
“If you look at Lagos State, for example, you look at Abuja, there is more urbanisation, there are more infrastructure. So, there is more financial inclusion in those places. What we then have to do is that, again, this is 2023. But we must make some comparisons, mostly, okay, are we making progress, but for us to say whether we’re making progress or not, the 2020 data must be comparable to the 2023 data. But again, remember that the 2020 data was done using the old frame.”