The African Development Bank has stated that it will collaborate with microfinance banks to boost assistance for micro, small, and medium-sized enterprises (MSMEs) and deepen financial inclusion in Nigeria through increasing use of financial technology tools.
Mr. Akinwunmi Adesina, President of the African Development Bank, said this in Abuja while addressing at the 7th annual symposium of the Nigerian Microfinance Platform, NMP.
Akinwunmi, who was represented by the Director General of the African Development Bank’s Nigeria Country Office, Lamin Barrow, stated that microfinance and MSMEs are critical to the economy and job creation, which is at the heart of the Bank’s poverty reduction efforts.
“But they need our support and so through our mediated support through Development Bank of Nigeria and others, we have supported about 20,000 MSMEs, but given the large number of MSMEs in Nigeria, this support is like scratching the surface.
“So we need partners like you and others to penetrate and even in larger numbers.”
While commending the theme of the NMP Symposium – ‘Expanding the Frontiers of Financial Inclusion Through Innovation: The Microfintech Tools’, Akinwunmi assured that AfDB, will work with all stakeholders to expand financial inclusion in Nigeria including through increased innovation and uptake of Fintech tools.
“It is the Bank’s belief that this symposium we help us develop a more holistic understanding of the financial needs of underserved households and small businesses and develop ways to enhance access to affordable products.
“We are seeing the development of powerful new technologies and there is therefore the need to seek for ways to combined technologies in the way that move the needle on financial inclusion
“The bank, your bank, is keen to contributing to building definitive ecosystem in Nigeria and we commend NMP for conveying this symposium.
As an institution the bank is open to dialogue and working with all stakeholders to expand financial inclusion in Nigeria including through increased innovation and uptake of Fintech tools,” he said.
Also speaking at the symposium, Deputy Governor, Financial System Surveillance, FSS, Aisha Ahmad, challenge MFBs to recognize that microfintech, which is Fintech applications adapted to microfinance, as veritage tool for surpassing the nation’s financial inclusion target and hence come up with ways to deploy them to provide cost-efficient manner to microfinance clients.
“MicroFinTech sweeps that traditional cost structure away and can operate without huge overheads as the marginal cost of delivering software to a new user is near zero. By leveraging technology – smart phones, peer authentication and even the e-Naira, the cost of delivering a microfinance service drops sharply. And as the cost drops, the cost-benefit ratio improves and profitability increases,” she said.
Similarly, Managing Director/CEO, Nigeria Deposit Insurance Corporation, Mallam Hassan Bello, stressed the need for MFBs to come up with innovative products that will not only attract more people into the sector, but also restore truth and dignity to the people who are deficit in both through the disruption of mobile technology operators, and to keep expanding and cut cost.
He added that the corporation on its part is currently reviewing its framework for financial and technical support to the MFBs sector in order to bring it up to the contemporary business dynamics and after it is done it will be more robust and accessible to eligible MFBs.