NDIC Decries Low Presence of MFBs in Northern Nigeria

15 Nov 2012

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MD, NDIC, Mr. Umaru Ibrahim,

  Obinna Chima  

The Nigeria Deposit Insurance Corporation (NDIC) has expressed concerns over the poor presence of Microfinance Banks (MFBs) in the northern part of the country.

Managing Director/Chief Executive Officer, NDIC, Mr. Umaru Ibrahim, who stated this in a speech presented at the on-going 2012 workshop for journalists tagged: “Deposit Insurance and Financial Inclusion,” in Dutse, Jigawa, insisted that the “grossly uneven” distribution of MFBs in the country is frustrating the country’s financial inclusion strategy.

The NDIC boss also disclosed plans by Central Bank of Nigeria (CBN) and NDIC to introduce All-Women MFBs to be owned 100 per cent by women.

Continuing, he pointed out that out of the 869 MFBs in existence, 346 (39.81 per cent) are located in the South-west, 162 (18.64 per cent) in the South-east, 158 (18.8 per cent) in the North Central, while only 63 (7.5 per cent) and 32 (3.68 per cent) are located in the North-west and North-east respectively.

He disclosed that Lagos, Anambra and Abuja had the highest number of MFBs.
“The uneven distribution has exposed the untapped potentials that require attention in order to realise the government’s policy on financial inclusion. The challenge for Jigawa state government and other northern States now is to set up MFBs to drive financial inclusion in the region,” the NDIC boss added.

He added: “Another measure that could be adopted to promote financial inclusion in Nigeria is the promotion of all-women micro-finance institutions. Evidence from other countries, for example, Kenya has shown that such institutions have the potential to promote easy access to credit amongst rural poor.”

He reiterated plans by the apex bank to introduce agency banking, saying that it would further drive the apex bank’s financial inclusion strategy.

Ibrahim explained: “A banking agent is a retail outlet contracted by a financial institution or mobile network operator to process clients’ transactions. Banking agents can be pharmacies, supermarkets and many more.

“Agent banking has the potential to grow access to banking facilities in that country, especially uneducated and those in the rural areas. Another area where agents could be meaningfully deployed is in the mobile payment system as successfully done in Kenya and some other countries.”

According to him, the importance of deposit insurance in improving financial inclusion cannot be over emphasised.

Tags: Nigeria, Featured, Business, NDIC, MFBs

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