Last week the World Bank’s Global Findex Database report was released about financial inclusion and how its impact in the world has changed millions of lives. I am a strong believer of financial inclusion and therefore, this report got me hooked from the word go. More than anything else, I was curious to know how Nigeria fared in comparison to other developing countries.
The report was conducted by World Bank’s Global Findex Database (2018) in collaboration with Bill and Melinda Gates Foundation. It’s considered to be the world’s most comprehensive data set on financial management and behaviour of adults with money matters. This report has been published every three years since 2011. One of the biggest finding was that financial inclusion was on an incline globally. This surely is good news! The biggest reason is the rapid growth in technology and penetration of mobile phones. Just between 2014 and 2017, a significant increase has been noted in the use of mobile phones and internet to conduct financial transactions from 67% to 76% globally, and 57% to 70% across developing countries. These numbers definitely got me excited.
But what about Nigeria? Where did it stand in this comparison?
The report points out that although financial inclusion is becoming a key driver of growth in world economies, Nigeria itself was lagging behind considerably. I wasn’t shocked, but I must confess my mild surprise. Over the last few years, about 65% of Nigeria’s population uses mobile phones. This number is surely on the rise. The youth is more tech savvy than ever, and they make up half of the total population. But despite these plusses, the World Bank Findex indicates a decrease in bank accounts by 4 basis points, from 49% in 2014 to 44% in 2017.
I was slightly disappointed, mostly because I truly understand the importance of financial inclusion and how it can change our people’s lives for the better. For one, financial inclusion encourages a habit of saving which could be of immense help on a rainy day. Further, the saving could lead to investment opportunities. Financial inclusion also enables people to borrow money to support or start a business. Its a critical step towards reducing poverty, inequality and enabling Nigerians to have a better life.
I have always been a strong advocate of financial inclusion and I believe that this can be turned around. We have the tech friendly youth, the growing population using mobile phones, an increase in internet penetration and most importantly Nigerians have the will to do better! It only requires for all of us to come together even if it is in small ways. We can encourage people who don’t have a bank account to open one immediately and educate them about its importance. Stop giving cash to your maids or drivers; instead, help them open an account. We need to be our own champions!