More emerging affluent consumers in Nigeria plan to start a business to increase their wealth than in any other market, according to a new Standard Chartered study.
The Emerging Affluent Study 2018 – ‘Climbing the Prosperity Ladder,’ – examined the views of 11,000 emerging affluent consumers – individuals who are earning enough to save and invest – from 11 markets across Asia, Africa and the Middle East.
In Nigeria 41 per cent of emerging affluent consumers said starting their own business was a strategy to meet their financial goals and increase their wealth.
This compares to an average of 27 per cent.
The study revealed that the number one financial goal for Nigeria’s emerging affluent was saving towards their children’s education, with 14 per cent stating this. It was also the top savings priority across the markets in the study (16%).
For more than one in 10 (11%) setting up a business is the top savings goal; this is higher than any other market – the average figure is just seven per cent.
“When it comes to meeting their financial goals, more than half (54%) of the emerging affluent in Nigeria say they invest with a target and a strategy to achieve it.
“Despite this, when describing the financial products, they use to meet their goals the most basic savings approaches came out on top: 59 per cet use savings accounts. By comparison, less than one-fifth use fixed income investments (19%), equity investments (13%) and mutual funds (12%); however, a quarter use property investment making this the second most popular method for this market.
“This could explain why currently more than half (54%) of Nigeria’s emerging affluent feel far away from achieving their top financial goal. The emerging affluent in Nigeria recognise that a lack of financial understanding may be stopping them from meeting their financial goals: more than a third (35%) say they feel held back in their aspirations by their lack of financial knowledge; and 58% believe financial education would help them reach their financial goals faster,” the report added.
The study also revealed that more than two-thirds (70%) of Nigeria’s emerging affluent believed effective wealth management holds the key to greater social mobility, so addressing the financial knowledge gap could play a crucial role in helping them to keep moving up the ladder.
Furthermore, the report stated that nearly two-thirds (64%) of Nigeria’s emerging affluent say their familiarity with digital tools has been vital to their personal success. Almost the same number (65%) said online banking makes them feel that they have more control over their money and investments, and 55 per cent said digital money management has helped them get closer to achieving their financial goals.
Commenting on the survey findings, the Head, Wealth Management, Standard Chartered,
Simpa Adaba said: “It’s exciting to see that social mobility is booming among the emerging affluent, and that they are outstripping their parents’ success in education, careers and home ownership. These aspiring consumers are determined to continue moving upwards, and know that investing can help them reach their financial goals.”