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BARELY one year to 2020 target to reduce ‘unbanked’ Nigerians to 20 percent, the Central Bank of Nigeria (CBN) last week began the race against time by unveiling the National Financial Inclusion Strategy, designed to ensure that at least 80 per cent of Nigerian population has access to banking and other financial services. The CBN had at a conference in Mexico in 2010, made a commitment to reduce the unbanked in Nigeria by no fewer than 20 per cent next year.
CBN Deputy Governor on Financial System Stability, Mrs. Aisha Ahmad, who unveiled the new policy at the National Financial Literacy Stakeholders’ conference in Abuja, also revealed that the apex regulator has released a new policy framework on Consumer Protection, Financial literacy and Education. She underlined the importance of financial inclusion and literacy education in a growing competitive financial environment, and noted that adequate consumer protection is critical to sustaining the long-term viability of the financial sector because consumer protection is a necessary precursor to building and maintaining trust in the formal financial sector. Stakeholders were also told that consumer education and financial literacy are the pillars on which any consumer protection regime is founded.
Statistics have shown that about 2 billion people worldwide currently lack access to basic financial services. Most of them are poor, and large proportions are Africans, and mostly Nigerians. Therefore, there is no doubt about the immense benefits of financial inclusion to a financially literate population. It will open door to families, allowing them to invest in their future through education and health. It will also allow them to access credit that enables businesses to expand, thereby, creating jobs and reducing inequality. Above all, consumers will be better equipped to make optimal choices in the use of financial products available in the ever-growing financial market, the risks and how to overcome such challenges. Considering the closeness of the 2020 deadline, it is important that the CBN devises a means to reach millions of Nigerians who are outside the financial inclusion net.
CBN statistics reveal that over 37 per cent or 60 million of our population are unbanked and about 46 per cent of bankable Nigerians do not have access to other financial services. The World Bank statistics reveal that Nigeria has the highest unbanked and underserved banking population in the world. Globally, there are 1.7 billion adults that are unbanked and without access to other financial services.
While the plan to achieve the 80 per cent financial inclusion target in 2020 is commendable, it is equally important that the CBN should find ways to reduce the factors that discourage some Nigerians from banking. The CBN should stop excessive charges by commercial banks. Though the CBN had in recent past warned against illegal charges by commercial banks and even threatened to impose sanctions on erring banks, some of the banks are still involved in the evil practice. The inefficient bank services may have contributed to the rise in the number of the unbanked Nigerians. For instance, in 2014, the CBN disclosed that commercial banks in the country illegally withdrew N17bilion from customers’ accounts. They were ordered to refund the money.
Therefore, considering the role of the banking system in the economy, financial inclusion has become imperative. However, Nigerian banks will remain at the back seat of global banking if they do not take ‘customer satisfaction’ seriously. And, as long as poor banking services persist, financial inclusion will be hard to achieve. Aggressive public education and literacy campaigns are necessary to drastically reduce the present high figure of the unbanked among the population. To achieve the objective of 80 per cent financial inclusion by 2020, the CBN must sustain the campaign. The unbanked should be updated on the benefits of financial inclusion. But the banks must avoid unethical practices that could discourage customers.
