Nigeria sets 2020 goal to have 80 per cent of its population financially included in the banking system.
Osita Ede, head of Mass Market Segment at Diamond Bank told CNBC Africa that the target is on track. He said in 2010 the number of Nigerians that were financially excluded was 46.3 per cent and at the end of 2014 that number was down to 39 per cent.
Ede is optimistic that if this trend continues, by 2020 the goal will be reached although a lot of things still need to happen. He highlighted that financial literacy is still poor and people are unaware of how to open accounts.
What has been done is to relax the documentation requirements. He said that in the past what needed to be done is to provide any one of the four forms of identity.
Now, the policy allows a flexible approach where you can come in with what you have, get the account open but have some restrictions on the account.
“So now you have low, medium and high value accounts and so progressively as you have more documentation you can increase the level of transaction that you can do,” he explained.
Diamond Bank has been able to provide financial inclusion to about four million people who would ordinarily have not been in the financial system, according to Ede.
“We have a volume of about 10 billion [naira], you are looking at funds that would have been in people’s houses under pillows, and these funds have come into the financial system now.”
Ede said the launch of Diamond Yellow has been a success, which was an initiative launched with MTN to open accounts through mobile phones.
“The implication is that it’s so easy to open from any part of the country, all you need is an MTN line.”
There is still a challenge to close the financial gap for people in the rural areas who do not have enough confidence in the financial system.