Home » Headlines » 23.8 million Nigerians save money at home – Report (Do you blame them?)

23.8 million Nigerians save money at home – Report (Do you blame them?)

February 29, 2012 by Dayo Oketola
Central Bank of Nigeria [CBN]
No fewer than 23.8 million Nigerian adults currently keep their money at home because they don’t have bank accounts.
A survey by Enhancing Financial Innovation and Access, a Nigeria-based financial sector developement organisation,  revealed that 52.8 million out of the country’s adult population saved money regularly. But the survey showed that only 20.5 million of the 52.8 million were doing so in banks.
This, according to experts, confirms a widely accepted industry statistics that there are about 22 million bank accounts in the country.
The report, released recently, also found that majority of the 23.8 million people, who kept money at home, were doing so with friends, families or through informal society or village associations.
The report further revealed that the main reasons why those people did not have bank accounts were irregular income, unemployment and distance to bank branches. It added that bank proximity was of great concern to the rural population.
Specifically, the report showed that 47.5 per cent of the 23.8 million people that kept money at home had no bank accounts due to irregular income; 33.6 per cent due to unemployment; 27.2 per cent due to bank location; 13.7 per cent due to illiteracy; and 13.2 per cent due to transport costs.
Another 9.7 per cent view the whole banking process as expensive, while 8.3 per cent lack trust in the banking system and the remaining 5.8 per cent stay off the formal financial system because of their apathy for documentation.
Our correspondent gathered that the 18 mobile money operators recently licensed by the Central Bank of Nigeria were now beaming their searchlight on this segment of the society with the aim of integrating them into the emerging mobile money scheme.
With a primary objective of providing financial inclusion for the over 80 million un-banked population in the country, our correspondent gathered that mobile operators had placed some priorities on the 23.8 million currently keeping money at home because they had already imbibed the habit of saving.
Our correspondent gathered that the mobile money operators were entering into multiple strategic partnerships with mobile network operators as well as Deposit Money Banks, while developing several products to attract the un-banked population.
The Managing Director, Fortis Mobile Money, one of the licensed mobile money service providers, Mr. Henry Nwawuba, described  saving as a major component of mobile money. He added that the advantages of saving were  security of funds, convenience and ease of use.
“Also, the personal, always-with-you and connected nature of the mobile phone gives the subscriber the confidence that his money is always with him,” he said.
Nwawuba emphasised that users would not lose their money when their phones get missing because their money is domiciled in a bank.
He said, “Mobile money’s low value transaction limits allow low-income earners to save small amounts for target projects and events.
“We have been actively driving savings through our unique products, which allow one to save on his or her mobile wallet or directly to his or her regular bank account through the mobile wallet.”
The Principal Associate, Mobile Money Africa, Mr. Emmanuel Okoegwale, added that with mobile money, the 23.8 million people keeping money at home would be able to gain access to mainstream financial services via their mobile phones.
He said operators were doing everything possible to provide financial inclusion for the underserved population.
Okoegwale, however, said it was important to note that majority of the 23.8 million home savers were not among the 49 million adult Nigerians, who did not have mobile phones and, as such, could not immediately benefit from the mobile money scheme.

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