SANEF: Creating jobs through financial inclusion

Rising poverty and unemployment in Nigeria provokes the need for job creation initiatives. The National Bureau of Statistics (NBS) recently revealed that 7.9 million Nigerian youth between the ages of 15 and 34 are currently unemployed. CHIMA NWOKOJI in this report appraises the Shared Agent Network Expansion Facility (SANEF) as a potent tool for job creation and economic empowerment.

SANEF is a project powered by the Central Bank of Nigeria, Deposit Money Banks, Nigeria Inter-Bank Settlement Systems, licensed Mobile Money Operators and Shared Agents with the primary objective of accelerating financial inclusion in Nigeria.

During the launch of the project, Managing Director, Guaranty Trust Bank Mr Segun Agbaje explained that the difference between this initiative and others is that this is being led by the banks and not the government.

“We are proud to say that as banks, most things we start, we tend to finish. The whole objective is to bring more people into the financial system and the money we are using to drive it is the money we have already set aside from the profits we have made,” Agbaje said.

The move, aimed at deepening financial inclusion in Nigeria, entails an aggressive rollout of 500,000 agent network that would offer basic financial services like cash-in, cash-out, funds transfer, bill payments, airtime purchase and government disbursements.

It also involves remote enrollment on Bank Verification Number (BVN) to an estimated 50 million Nigerians that are currently under-banked or unbanked. By this, enrollment centres will be opened at the headquarters of every local government area in Nigeria.

Commenting on the programme, Chief Executive Officer (CEO) of Access Bank Plc, Herbert Wigwe, who also doubles as the Chairman, Body of Bank CEOs, stressed that the agreement reflects commitments to aggressively pursue the CBN’s 2020 financial inclusion target in an integrated way with minimal systemic risks to the financial system.

He also noted that the initiative will generate over 500,000 new jobs for Nigerians over the next two years. Aside this, those in the informal sector who will now be migrated into the formal sector will be able to get loans to start small scale enterprises.

The strategy of the CBN and banks is to reach the expectations of the Nigerian banks to onboard and formally bank 60 million additional Nigerians over the next three years on an average of 20 million yearly, as well as enroll 40 million for BVN.

Stakeholders are convinced that SANEF will deepen financial inclusion in Nigeria through an integrated ecosystem with strong regulatory oversight, consumer protection and interoperable payment systems with limited concentration risk.

It will create a platform for Nigerian owned financial services companies to grow, whilst empowering and creating jobs for Nigerians. So, wherever there is a sign of SANEF or logo of mobile money agents, Nigerians can perform basic financial services such as account opening, cash deposits, cash withdrawals, funds transfers and bills payments.

To this effect, renewed focus will be given to driving low cost digital access, broadening financial literacy campaigns, and creating micro insurance and micro investment products for the benefit of excluded, underserved and low income Nigerians.

Speaking for the mobile money operators, the Founder/CEO, Paga, Tayo Oviosu, maintained that to significantly raise the financial inclusion level in Nigeria, “we need to offer truly effective digital financial services that operate on all mobile telecom networks and a robust nationwide network of agents for convenient access.

“The SANEF programme supports our plans to rapidly scale up the agent network over the year and with this, the entire financial industry will reach deeper into even more communities and give millions of Nigerians convenient access to financial services,” Oviosu said.

With this, the licensed Mobile Money Operators are deploying financial services agents’ outlets in underserved urban and rural areas in Nigeria, with higher priority in the northern geo-political zones where financial exclusion is most predominant.

In line with this initiative eTranzact, one of the 10 licensed e-payments solution providers, said it is set to deepen financial inclusion by expanding its PocketMoni service with 10,000 active mobile money agents, within the next 24 months.

SANEF according to the promoters is also intended to drive the Federal Government’s Social Investment Program (SIP) which relies on improved banking agent network coverage points.

A member of the SANEF technical committee Mr Bolaji Lawal said a savings account product with an array of features (insurance, pension and micro credit) would be created to be a pull factor to attract the financially excluded into the system. Through this account, even people at the rural areas will have access to loans and other social benefits from government; since they can easily be identified. It will blend tier 1 and 2 accounts and use BVN as sole requirement.

“We are liaising with regulators (CBN, NAICOM) to secure approval and launch product by October 1, 2018. Other products planned include: micro retail loans; micro retail savings (to be known as government savings account); retail insurance and micro pensions,” he added.

The Acting Managing Director/Chief Executive Officer, eTranzact, Niyi Toluwalope “As a global leader in the electronic and mobile payment industry, we are well-positioned to deliver and attain the goals set by the CBN for this project. He stated that, “Over the next 23 months, eTranzact plans to leverage its Mobile Financial Services Business to deliver an additional 1,000,000 active end-users, by deploying its innovative distribution capabilities anchored on its active agents.”

 

The SANEF journey

In 2010, Nigeria made a commitment to reduce the adult financial exclusion rate in the country from 46.3 per cent to 20 per cent by the year 2020. In order to attain this target, the National Financial Inclusion Strategy (NFIS) was launched on October 23, 2012.

While some notable milestones have been achieved, overall financial exclusion rate still stands at 41.6 per cent based on the biennial Access to Financial Services in Nigeria Survey (EFInA 2016). The Central Bank of Nigeria has been working with various stakeholders to conduct a review and refresh of the Strategy. The exercise focused on evaluating progress, identifying gaps and developing a refreshed strategy document which serves as a roadmap for implementation till the terminal year 2020.

The CBN has therefore directed all banks (including Microfinance Banks and Primary Mortgage Institutions) that appoint/have agents, Mobile Money Operators and Licensed Super Agents to render daily returns, through the Nigeria Inter-Bank Settlement System (NIBSS) Plc. This will be done in the mode and template prescribed by NIBSS. The transaction data is required daily, so as to plot the growth and type of services being offered across the country.

NIBSS according to the promoters will provide a reporting dashboard for the purpose of monitoring the performance of Agents and ensuring the Agent Managers provide daily or weekly reports of enrollments and all registrations carried out. Fees and all charges in respect of the agent banking shall be explicitly stated in the contract, and a shared service platform to monitor agent managers and agent known as NIBSS Agency Services MAP (NASMAP) will be put in place.

According to Lawal, there has been an aggressive roll-out of over 70,000 new Financial Access Points while 9 operators currently party to SANEF has received N4.5 billion to drive the initiative. The operators include three mobile money operators: Paga, Cellulant, eTranzact;  six Super Agents: Interswitch, Capricorn, Innovectives, Inlaks, Unified Payments and Xpress Payment Limited.

Available records show that BVN enrolment currently stands at 33 million. The plan is to scale it up to 70 million by 2020. 10,000 remote BVN devices has been ordered by NIBSS and currently being deployed to Banks, MMOs and Super Agents while training and certification is ongoing with a commitment to enroll 40 million new unique BVNs between now and year 2020. This is broken down thus: 10 million in 2018, 15 million in 2019 and 15 million in 2020. In terms of returns, the NIBSS will pay agents N100 for every unique BVN enrolled. This means that the agents will require more Nigerians to work with.

In terms of financial literacy, he said customer education campaign has commenced. Phase 1 covers general awareness through print and electronic media, involving customer engagement, town hall meetings and influencer endorsement. Radio campaigns on 33 network stations are ongoing under this phase, while phase 2 will be to launch and promote the Government Savings Account and remote BVN enrolment drive.