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How Nigeria's evolving financial services ecosystem can drive inclusion
Nigeria's financial services ecosystem is evolving at a pace never experienced, as traditional banks, FinTechs and telecoms players jostle to make their mark, we find out how this propels the drive for financial inclusion. Uzoma Dozie, Managing Director at Sparkle joins CNBC Africa for this discussion.
Thu, 06 Oct 2022 12:00:00 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- Addressing social inclusion as a prerequisite for financial inclusion
- Importance of digital identity in enabling financial services access
- Challenges and solutions in advancing financial inclusion in Nigeria
Nigeria's financial services ecosystem is undergoing rapid evolution, with traditional banks, fintech companies, and telecom players vying for dominance in the market. This competition is not only shaping the landscape of financial services in Nigeria but also driving the push for financial inclusion in the country. In a recent interview with CNBC Africa, Uzoma Dozie, the Managing Director and CEO of Sparkle, discussed the critical role of social and digital inclusion in advancing financial inclusion in Nigeria.
Dozie highlighted the importance of addressing social inclusion as a prerequisite for financial inclusion. He emphasized the need to focus on uplifting individuals out of poverty, providing access to basic necessities such as food and education, and establishing a robust identification system. According to Dozie, without first ensuring social inclusion through proper identification and education, achieving meaningful financial inclusion remains a distant goal.
One of the key foundations for financial inclusion, as Dozie pointed out, is digital identity. While Nigeria has made progress in implementing biometric identification systems, there is still a long way to go in ensuring widespread and accurate identification of individuals. Digital identity serves as the gateway to financial services and is essential for targeting resources effectively and incentivizing social and financial inclusion.
The conversation then shifted to the challenges impeding financial inclusion in Nigeria. Dozie addressed the barriers identified by the World Bank, including the lack of funds, high costs of financial services, and limited accessibility to financial service providers. He underscored the need to formalize the informal sector through digital solutions to bridge the gap between traditional banking services and the vast informal economy in Nigeria.
Discussing Sparkle's approach to financial inclusion, Dozie emphasized the importance of understanding the habits and behaviors of individuals and small businesses. By tailoring solutions to align with the lifestyle and needs of users, Sparkle aims to facilitate financial inclusion for the millions of businesses operating in Nigeria's informal economy. The company leverages technology to provide small businesses with access to finance, markets, and essential business support services, such as payroll and taxation.
In light of Nigeria's rapidly growing population and evolving economic landscape, Dozie acknowledged the dynamic nature of financial inclusion. He emphasized the role of technology, particularly mobile and digital solutions, in keeping pace with population growth and changing consumer habits. By embracing digital technologies and biometric identification, financial service providers can adapt to the shifting demographics and behaviors of their target market.
Ultimately, Dozie emphasized the interconnectedness of social, digital, and financial inclusion, highlighting the need for a holistic approach to address the multifaceted challenges facing Nigeria's financial services ecosystem. By prioritizing social upliftment, enhancing digital identity systems, and leveraging technology to bridge the gap between formal and informal sectors, Nigeria can drive meaningful financial inclusion and empower individuals and businesses across the country.
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