Umaru Ibrahim, managing director, Nigeria Deposit Insurance Corporation (NDIC) has called on stakeholders in the mobile money business to seek ways of extending the service to a larger proportion of the population.
Ibrahim stated this at a roundtable discussion on mobile money services held in Lagos, said that there are over 100 million mobile phone lines in the country.
He said: “According to Enhancing Financial Innovation and Access (EFiNA) survey, the rural population is 71 per cent, while 76.2 per cent of the population remains unbanked. Mobile phone ownership is 55.6 per cent in the rural areas.”
He explained that effective rendering of mobile banking financial services can be a key mechanism in achieving the objective of National Financial Inclusion Strategy (NFIS) based on the huge success recorded by Kenya, Uganda and South Africa in enhancing financial inclusion through mobile financial services.
Ibrahim said mobile banking subscribers will soon get deposit insurance coverage, with each subscriber guaranteed up to N200,000, or N500,000 as applicable to Microfinance Banks/Primary Mortgage Banks and Deposit Money Banks(DMBs) respectively, in the event of bank failure.
He explained that if a bank fails, the insured mobile account can be transferred to another sound bank, to further engender public confidence in the system and promote financial stability.
According to him, the framework for extending deposit insurance to individual customers of mobile payment services is being finalised.
He explained that mobile payment is operated under financial regulation and performed from, or through a mobile device.
“It is a convenient, secure and affordable way to send money to friends and family, using mobile phones and/or other electronic devices like internet facilities,” he disclosed.
Ibrahim stressed that with mobile money, all economic agents can transfer funds to any recipient in the country and outside the country, as well as pay for their goods and services, using their mobile phones and other electronic devices.
“Mobile phones, in particular, are an attractive way to promote financial inclusion given their extensive use by the population and global reach. Mobile phones can serve as a virtual bank card, point of sale terminal (PoS), Automated Teller Machine (ATMs) or internet banking terminal. The confluence of banking technologies with mobile telephony leads to wider penetration and holds new promise of financial inclusion for the minority of the unbanked,” he emphasised.
He said the Central Bank of Nigeria (CBN) issued a regulatory framework for the operation of mobile payments services in Nigeria in 2009, adding that the apex bank has also granted licences to 21 mobile money operators.