April 22, 2019

Developing new banking products to accelerate CBN’s Financial Inclusion

Governor, Central Bank of Nigeria (CBN), Mr Godwin Emefiele

By Emefu Ibeayoka

OVER the years, the  Central Bank of Nigeria (CBN), has introduced several reforms to create a robust financial system framework. These reforms are focussed on enhancing banking system stability, sensitizing the gains in serious governance and restoring confidence in the nation’s financial system.

For example, in 2007, it floated the Payment System Vision (PSV 2020) initiative and in 2013, focussed on providing mechanisms for making and receiving payments. With the minimum risk to the CBN, the payment service providers and end users, the operation aimed at accommodating the banked, underbanked and the unbanked. This was structured to conform to regulatory, technical and operational standards across all economic activities, geographies and accepted across all international boundaries.

Also recently,    the CBN berthed the National Financial Inclusion Strategy (NFIS) which seeks to ensure over 80 percent    bankable adults in Nigeria have access to financial service by 2020. In addition to what the deposit money Banks and other financial institutions have been doing, the CBN has cleared the way to license a new set of operators referred to as Payment Service Banks (PSBs). It has also spelt out the requirements, the structure, what will be allowed and what will be considered illegalities. The key objective is to accelerate financial inclusion in rural areas. By so doing, there will be increased access to deposit products, payments and remittance services to small businesses, low income households as well as entities through high-volume low-value transaction in a secured technology-driven environment.


Governor, Central Bank of Nigeria (CBN), Mr Godwin Emefiele

Democratising banking services

Leveraging on these regulatory agenda, and to democratise banking services to every segment of the society, First City Monument Bank (FCMB) recently introduced the FCMB Easy Account. It launched the product to give full translations to the CBN’s vision of truly taking banking to the nooks and crannies of the nation’s towns and villages, particularly to everyone who has never owned a Bank account. Commonly associated with, “Your Phone Number is Your Account Number” and “The Last Ten Digits of Your Phone Number are Your Account Number”, investigations reveal that FCMB has invested heavily in state-of-the-art technology and is perfecting a world class infrastructure that conforms to the best practices on data, storage, security and integrity, to continue to give its customers sustainable positive experience in quality and satisfactory service.

George Ogudu of the apex Bank’s Financial Inclusion and Strategy Secretariat commended FCMB for taking the lead in developing the product. While endorsing FCMB Easy Account, he stated, “FCMB has taken a giant stride to prove its commitment to bringing more Nigerians into formal Banking. The fact it targets those who have never owned bank accounts and serves as a convenient opportunity for this category of Nigerians to do so, is very laudable. We consider this as further strategic support towards the full realisation of the CBN’s financial inclusion initiative. We appreciate FCMB for consistently being very innovative and a partner in progress”.

FCMB Easy Account

FCMB Easy Account is said to have been designed to make banking accessible to all Nigerians and help to achieve the laudable goal of financial inclusion for most Nigerians as set by the Central Bank of Nigeria (CBN). The product has been made open to all, particularly to meet the needs of low-income earners and the unbanked segment of the society. It allows the account holders have access to convenient and secured financial services, irrespective of their locations.

The bank stated the self-service, stress-free and secured offering, available on all the Global System for Mobile (GSM) networks in Nigeria, (Globacom, MTN, 9Mobile and Airtel), enables everyone anywhere in Nigeria open an account from his or her location, by dialling *329# from a mobile phone and following the instructions. The development now enables Nigerians who wish to open accounts and carry out banking transactions on any type of mobile phones do so from any location-rural, urban and remote, even if there are no banks physically located at the area. Internet service availability or data is not required for FCMB Easy Account as the account operates on the USSD platform. Its customers can send and receive money to and from friends, families and business partners across all banks in Nigeria. Customers can also deposit funds into their accounts at more than 100,000 agent and banking locations of FCMB and other banks and mobile money operators in Nigeria. FCMB Easy account customers can also use their accounts for airtime purchase, bill payments and other payments.

Digital Transformation

FCMB’s Managing Director, Mr. Adam Nuru said what the bank unveiled in FCMB Easy Account is a part of its long-term strategic plan to embark on a digital transformation initiative where it aspires to scale business operations, build capabilities and find the best way to simplify banking for customers, using technology.

Nuru said, “Every day we are developing digital innovations and ideas that will make our relationship with our customers seamless in so many areas including Channels Management among others. FCMB Easy Account is one of such innovative offerings that make Banking services available across all informal segments, particularly the unbanked. It is banking made easy. All you need is to own any type of mobile phone, and you do not even necessarily need to buy data”.

African Development Bank (AFDB) has said, for sustained inclusive development to thrive, a great deal of innovation and thinking are needed to ensure appropriate financial services and instruments should be deliberately put in place for the benefit of the poor and other vulnerable groups. The Bank said there must be provision of appropriate service that is both accessible and affordable to low-income and vulnerable households. This is what the Bank has targeted with the FCMB Easy Account. Its Executive Director, Retail Banking, Mr. Olu Akanmu said,

“With the launch of FCMB Easy Account, we make a bold statement on our commitment in FCMB to the greater social purpose of banking, that banking should be socially relevant not only to the privileged but to all people. That the benefit of financial intermediation, particularly the ability to have a bank account, should be more inclusive for all Nigerians. That every Nigerian should be able to own a bank account no matter their geographic or social location, whether they are in urban or rural areas, whether they are in cities or villages or whether they are rich or poor”.

Financial Inclusion models

Uche Uzoebo who heads Agency and Merchant Services in one of the new generation banks, while responding to a media inquiry on the challenges facing financial inclusion in Nigeria said, “Bangladesh for instance has a bank-led model of financial inclusion, Kenya has Telco-led; Brazil has a combination of both bank and Telcos. I see Nigeria having a combination of banks and Telcos. The truth is that Nigerian government and the governments of other countries are not the same, so we don’t also have the same basis for judgement”.

She said most of the time, when people discuss financial inclusion, they often compare Nigeria with Kenya. Uzoebo would not make such a comparison because they consistently got a lot of strategy right in Kenya, a scenario that is different in Nigeria.      “In Kenya, there are people in remote areas carrying out transactions through mobile money and several agents are championing those transactions, but in Nigeria, there are some locations one cannot get to because of security issues”. But the FCMB’s Executive Director, Retail Banking, Mr. Olu Akanmu, said FCMB Easy Account is a part of the Bank’s core strategy to innovate and expand its service channels by promoting and deepening financial inclusion and the cashless policies of the Central Bank of Nigeria (CBN) across regions in Nigeria. The differentiating factor Akanmu said is,

“FCMB Easy account helps to achieve the goal of national, financial and social inclusion where all Nigerians have access to formal financial services and their benefits, no matter their situation or location. In FCMB, we are determined to be a critical part of the effort to create a more inclusive society of shared prosperity, where all Nigerians, informal traders, micro SMEs and small holder farmers in agriculture are connected to the shared prosperity that formal financial services engender”.

Ibeayoka, a financial and public opinion analyst, writes in from Abuja.