North accounts for 68.6% of financially excluded Nigerians

The three northern regions currently account for the most financially-excluded areas in Nigeria, a survey by the Enhancing Financial Innovation & Access (EFInA), revealed.

Specifically, the North East has 38.4 per cent excluded adults; North West 18.3 per cent and North Central 11.9 per cent.

South West recorded 11.5 per cent excluded adults, South East 9.9 per cent, and South South accounted for 10.0 per cent.

Generally, EFInA informed that 36.6 million adults are currently excluded, with 78.5 per cent residing in rural areas, while 21.5 per cent are in the urban places.

EFInA disclosed that financially-excluded adults earn less than N35,000 ($100) a month, adding that 37.7 per cent earn below N15,000 per month. Also, 26 per cent earn between N15,000 and N35,000 monthly; six per cent earn between N35,001 to N55,000 per month; two per cent earn N55,001 and N75,000 monthly; one per cent earn N95,001 to N115,000 and N115, 001 and N135,000 per month.

The Chief Executive Officer, EFInA, Esaie Diei, disclosed this in a presentation titled: ‘Access to Financial Services Survey in Nigeria,’ at The Guardian-organised forum on, “Advancing Financial Inclusion,” dtheme: ‘Expanding Financial Inclusion via Knowledge exchange, Technology and Value-addition.’

Diei noted that over the past 10 years, financial access has grown significantly, but key financial inclusion challenges persist, adding that due to Nigeria’s rapidly growing population, just maintaining current rates of financial inclusion will require bringing more than one million Nigerians into the financial system yearly.

He said a higher percentage of financially-excluded adults can speak Hausa than English, similarly, a higher percentage can read Hausa than can read English, “but 15 per cent of financially-excluded adults cannot read any language comfortably.”

Despite the economic challenges in Nigeria, Diei observed that 24 per cent of financially-excluded adults are saving, “and they save mostly for emergencies.”

He, however, said that 18 per cent of financially-excluded adults are borrowing from family and friends. “When financially-excluded adults who are borrowing were asked for the main reason why they took out their largest recent loan, 39 per cent cite reasons related to smoothing consumption (buying food, clothing, household goods); while 24 per cent cite reasons related to buying agricultural inputs or investing in business.”

According to EFInA, top reasons given by financially-excluded adults for not using banks are irregular income and unemployment. Distance and cost to reach banks are also cited as barriers, indicating the potential value of agent networks.

On this basis, the Shared Agent Network Expansion Facility (SANEF), said it will recruit 500,000 agents network by 2020.

Speaking at The Guardian event, the Chief Executive Officer, SANEF, Mrs. Ronke Kuye, said from the 500,000, about 30 per cent will be deployed in the North East; 30 per cent in North West; 20 per cent in North Central; five per cent in South West, and the rest to other regions.

Kuye, who disclosed that SANEF is already on a sensitisation education to the six geo-political zones of the country, and will get intensified this month, especially in the grassroots areas.

She revealed that SANEF is working with the Central Bank of Nigeria (CBN), and the National Insurance Commission (NAICOM), on deepening financial inclusion.

SANEF is a project powered by the CBN, Deposit Money Banks, Nigeria Inter-Bank Settlement Systems, Chartered Institute of Bankers of Nigeria, licensed Mobile Money Operators and Shared Agents with the primary objective of accelerating financial inclusion in Nigeria.