By Babajide Komolafe and Rosemary Onuoha
The Nigerian Deposit Insurance Corporation, NDIC, has called on northern state governments to facilitate the establishment of microfinance banks (MFBs) in their region, saying that the region has the least number of MFBs in the country.
Managing Director, NDIC, Mr. Umaru Ibrahim, made this call while speaking at NDIC seminar organised for financial correspondents and business editors in Dutse, Jigawa State, last week. He said North East and North West are lagging behind in terms of microfinance penetration, as they have only 32 MFBs, representing 3.68 per cent of the total number of MFBs nationwide.
“To enhance financial inclusion especially in Northern Nigeria, it is imperative for the governors of northern states to therefore encourage and promote the establishment of microfinance institutions in their respective states”, he said
While expressing displeasure on the uneven distribution of microfinance banks in the country, he said of the 869 MFBs in existence, 346 of them, equivalent to 40 per cent of micro banks are located in the South West geopolitical zone. He added that 162 MFBs are situated in the South East, while the North Central has 158. He said that North East and North West on their part has 63 MFBs and 32 MFBs respectively.
Of the total number of provisional and final microfinance bank licences issued by the Central Bank of Nigeria(CBN), northern Nigeria, including Federal Capital Territory(FCT) had only 25 per cent.
Ibrahim said MFBs are globally recognised as veritable tools for financial inclusion as they play a meaningful role to ensure that rural dwellers as well as the economically active poor are engaged in economic activities through financial intermediation.