Samuel O. Oladimeji is the Managing Director/Chief Executive Officer of Fortis Mobile Money, one of the companies that set the ball rolling in the mobile money industry.
In this interview with PorscheClassy Media, Oladimeji highlights the importance of mobile money, he also explained how the mobile money industry holds the potentials to deepen financial inclusion in Nigeria.
What informed Fortis Microfinance venturing into mobile money operations?
Fortis has been in existence for about six years now although we were licensed since 2010 by the CBN. We are one of the foremost firms that were licensed to operate in the aspect of mobile money. Ever since, we have been on the field to improve on the financial inclusion of the policy of the CBN; to bring in more people who are outside the circle. Presently, by statistics, between 2010 and 2011, we have about 70 percent people who are unbanked which is a huge number. Even among the 30 percent that are banked, CBN says only 10 percent own the money in the system which means that there are lots of people who are not in the financial circle.
So our aim is to ensure that we bring these people into the fold because the more we have people in that fold the more the economy will grow. The economy does not have to depend on 30 percent of people doing trade. From our findings, the money is actually with those people that are not in the circle because they keep it under their pillows, dig the ground to bury it, put it in their farms etc. If we can bring those in, there will be enough liquidity to run the economy.
One of the statistics I saw last year showed that the money with the unbanked can fund Nigerian projects for seven years. This means that if we can just get those monies, Nigerian projects can be funded and this will make it unnecessary to depend on oil. So we need to expand this net to bring in more people.
As at the last count, we have over 200,000 clients on our platform; we have over 6,000 agents who are transacting on our platform. Last year we reached our peak which was four billion in a month.
What is the mobile money concept in a nutshell?
Mobile money concept is all about giving alternatives to people that cannot get to the bank. The CBN came up with it because it was observed that the banks have so much rules before one can become a customer. They came up with a three tier where you have the completely unbanked, semi banked and the fully banked. For the unbanked, you don’t need any identity card; all the customer needs is just to fill the form or dial the short code to become a registered subscriber. Within that brand you can do some certain transactions.
So mobile money came to relieve people of the pressure of going to the bank; also, the fact that the bank doesn’t have enough facilities to cater for all the people. As you know some banks are not in some local governments but with mobile money agents in the LGs, you can transact and do financial services. So mobile money is not an alternative but a way to compliment the banks. We can say the money is mobile because it can move to where you are. So mobile money is just a way to compliment the financial sectors’ inadequacy to meet the financial needs of the populace. How it runs is that when you are a customer, you have a wallet; your phone number becomes your account which is your wallet therefore you don’t need to open another account. You can still use that same phone number to do whatever you want to do, like the purchase of recharge cards and your phone calls are not affected, it just serves as an account for you.
So instantly, when you register with us, we create an account for you. If you are coming without any KYC which means you are not bringing an identity card and house address, then one can do a transaction from 0 – N30,000 which is the stipulation from CBN. Anything above N30,000, you have to show some means of identification because the volume is growing. It then means that we need to improve on the risk aspect of the institution, so the customer needs to identify the customer.
Also, the fact that NCC (Nigerian Communications Commission) has ensured that everyone is registered, it has also given us some sense of safety because you must capture some vital information about yourself before you can even have a SIM card now. As it stands now, we are encouraging people to come to the financial net every day. The role of CBN on this is making it easier. It has been challenging because some people don’t even believe that this is possible but with our experience we have seen that it is possible.
Do you accept deposit and give out loans as part of your activities?
By our regulation which is the policy from CBN, we are not allowed to embark on those activities because we are not a money deposit bank, meaning we cannot take deposits but what we can do is that you can fund your wallet through us. We are like an intermediary for you to ensure that you have the financial service you desire. For instance, if you have N20,000 raw cash and you want to be able to transact or pay your bills, buy your airtime, transfer to families and friends, you have the platform to go ahead and do all that. You can pay to any of our pool accounts and instantly you get funded on your wallet. So, with that electronic value in your wallet, you can do whatever you want to do.
How many agents do you have so far?
So far, we have about 6,700 across the country.
Are you in all states and local governments?
Presently, we are in 22 states but we are getting ready to expand to 10 more states within the next six months. We are rolling out new products that will appeal to the people in the states. Based on our last count, we are strong in the North Central, we are strong in parts of the South West, also in some parts of South East but the North Central is like our base and we have agents in all these areas such as Nasarawa, Niger, Benue, Kogi, Kwara, Kano, Gombe and some parts of the North East such as Jigawa, Adamawa and Borno. We also have in Lagos, Oyo, Anambra, Imo, Abia, Rivers, Cross River and some parts of Bayelsa. In all these states, we have agents and they are all doing well.
Can you give us an estimate of the size of the mobile market now in Nigeria?
The mobile market in Nigeria now is picking up. But if you are talking about the mobile money shares of the market, that is different. So generally, among the banked we have in Nigeria, we are looking at the range of 22 to 30 million people in this mobile space. You can link that to the number of accounts available which are the banks and mobile wallets available. Like, we have between 0 to about 350,000 wallets for Fortis alone. Globally, I cannot say that we have up to five million wallets even though we have over 50 million phone lines active in Nigeria, but less than 10 percent wallets globally are active which means that there is a long way to go. Yet this is a real convenience for people because it provides the opportunity where people do not need to go to the banks to do their transactions.
You have told us the minimum, what is the maximum?
From CBN KYC, the maximum is one million. Most Mobile Money Operators (MMO), because of risk are not doing up to that one million because they understood the type of people we are reaching out to. So if you are doing one million, there is the fear that something could go wrong but CBN gave that rule so that you could do from zero to 30,000 then from 30,001 to 100,000 then from 100, 001 to one million which spells out the three tiers as stipulated by CBN.
Kenya is doing a lot with mobile money, do you think Nigeria is doing what Kenya is doing?
I will say yes, partly. I was in Kenya March this year to attend the 10th anniversary of the Safari conference. Kenya has gone all the way that even in IDP camps they disburse funds. We are still struggling in that area. Yes, we are on the right path with good legislation, good policy, good incentive from government but Kenya saw mobile money as one of the ways out of their financial issues.
What have you identified so far as the challenges in the industry?
The major challenge is adoption. Like I have just told you about the difference of the number of lines available and the number of wallets available, it all has to do with adoption. People need to believe that this thing is actually real and convenient. When people make that adoption, the market will grow. With the banks entering into our space, I will not say that we are threatened but I will say that it is a real challenge because almost all banks now have mobile money markets so most times instead of people coming to you, they can go to a GTB or any other commercial bank and this tells you that we are really under threat in this space. So we need more incentives that can protect us.
How attractive is it for an agent of your agency?
From the industry analysis we have done, right now I think we are one of the best mobile money operators an agent can come up with. What I am saying is this, for every transaction done, there is an income your earn and our income is better than others as it stands now. If you are an agent with Fortis Mobile Money you earn a lot and there are other things we do, like being able to fund you offline. If you are in a place where there are scarce banks and we see your traction that you have done a lot of transactions, we will fund you while waiting for when you will remit the money
BREAKING: South Africa Enters Technical Recession After GDP Declines For A Second Quarter
Reports from South Africa show that the country’s economy, the second largest in Africa, has again dropped into a technical recession.
This was after the nation’s Gross Domestic Product (GDP) for the second quarter of 2018 compressed further by 0.7 percent, according to figures released on Tuesday by Stats SA.
This marks two consecutive periods of contraction the country was recording, which therefore equates to a recession.
In the first quarter of this year, South Africa’s GDP contracted by 2.6 percent.
“Real gross domestic product (measured by production) decreased by 0.7 percent in the second quarter of 2018, following a decrease of 2.6 percent in the first quarter of 2018.
“The largest negative contributors to growth in GDP in the second quarter were agriculture, transport and trade,” the Stats SA said in its report today.
This is the first recession South Africa is entering into since its new leader, Mr Cyril Ramaphosa, took over from Mr Jacob Zuma, who also witnessed an economic recession while in office.
UBA’s Leo Launched On WhatsApp
Pan-African Financial Institution, United Bank for Africa (UBA) has announced the commencement of its chat bank ‘Leo’ on the WhatsApp platform.
With Leo on WhatsApp, customers who are users and lovers of the app can now perform basic banking services including checking their balances on the go, transferring funds, paying bills, among other services.
The Group Managing Director/Chief Executive Officer, UBA, Mr. Kennedy Uzoka, who expressed excitement about the development remarked that the bank is continuously working in line with customers’ demand to ensure that banking services are made convenient and without stress.
He said, “This only goes to show that our resolve in continuing to deploy innovative solutions that place customers first, using cutting-edge technology for their collective satisfaction and excellent banking experience is important to us. This recognition will further spur us to do more in meeting the needs of our customers with unrivalled services.”
“Our recent launch of Leo in 13 other African countries is evidence that UBA has on its agenda, the objective of digital creativity especially in service for our trusted customer base across the African continent.”
Also speaking on the new service, the Group Head of UBA’s Online Banking, Mr Austine Abolusoro, stated “United Bank for Africa is a technology-driven institution with vast knowledge in the business that we do and Leo, being a tested dependable and intelligent personality, will replicate on WhatsApp, the success it has experienced on the Facebook Messenger platform. It is a solution that is from the customer’s standpoint, easy to use by anyone regardless of your demography.” “Leo is ready and waiting to help with any form of banking services,” continued Abolusoro.
WhatsApp has been in existence for over 9 years, reaching more than 1.5 billion people in over 180 countries. The premium private chat platform has assured that there will be no spam messages as the development is to enable businesses to serve their customers with useful and helpful information.
LEO is already present in over 14 African subsidiaries, including Nigeria, available in three languages, and has now been rolled out to customers on WhatsApp. To use this service on WhatsApp, customers must add the LEO Whatsapp number: +234 903 000 2455 to their phone contacts, then search for UBA Chat Banking on WhatsApp to start enjoying the added convenience and ease of transacting with Leo on WhatsApp.
UBA is one of Africa’s leading banks with operations in 20 African countries and in London and New York, with presence in Paris. Adjudged to be at the forefront of innovation and convenient banking, UBA is one of the first financial services institutions on the continent to deploy Finacle 10x, a new information technology platform that boosts its services and electronic banking channels. Today, UBA provides banking services to more than 15 million customers globally, through thousands of touch points and diverse channels.
UBA Appoints Four New Board Members
The Board of Directors of the United Bank for Africa is pleased to announce the appointment of four new members to its board, subject to the approval of the Central Bank of Nigeria(CBN).
The new board members are Mrs. Erelu Angela Adebayo, Ms. Angela Aneke, Alhaji Abdulqadir Jeli Bello and Mr. Isaac Olukayode Fasola.
These appointments follow the retirement of Mrs. Rose Okwechime, Mr Adekunle Olumide, OON, Alhaji Ja’afaru Paki and Mr Yahaya Zekeri, with effect from August 30, 2018.
“I am pleased to welcome Erelu Adebayo, Angela Aneke, Abdulqadir Bello and Kayode Fasola to the Group Board,” said Tony O. Elumelu, the Group Chairman of the Bank. “These men and women bring a wealth of experience in their fields and will be tremendous assets, as we deliver on our mission to become the leading Pan-African financial institution in all our countries of operation.”
‘I am particularly pleased that two of the newly appointed Non-Executive Directors are women, bringing the total number of women to four, a further demonstration of our commitment to ensuring equality for both men and women,’ added the Group Chairman.
Mr. Elumelu thanked the retiring directors for their contribution, hard work and commitment to UBA, “I would like to express my appreciation to our retiring Directors for their leadership and dedication to UBA and for their contribution to an already impressive 2018. I wish them the very best in their future endeavours”.
This announcement comes on the heels of the Bank’s strong H1 2018 performance with a PBT of N58.1billion. With the successful expansion of its retail operations, UBA now operates in 20 countries in Africa, following its recent acquisition of a licence in Mali and the United Kingdom. The bank also has offices in New York City and in Paris.
About the new Directors
Erelu Angela Adebayo who graduated with an M.Phil in Land Economy from Cambridge University is the former First Lady of Ekiti State in Nigeria. Mrs Adebayo previously served on the boards of several organisations, including the Dangote Foundation, DN Meyer Plc, Wemabod Estates. Mrs Adebayo is a council member of the Nigerian Stock Exchange and has worked extensively on real estate development and She is the Chairman of the Erelu Adebayo Foundation for the underprivileged.
Ms. Angela Aneke is a board advisor, banker and a strategic thinker with over 30 years’ experience in financial services, in the areas of financial control, strategy, transaction banking, corporate banking, retail banking and governance. Ms. Aneke has held executive management and board positions in several international and regional institutions, including Ecobank Transnational Incorporated and the United Bank for Africa.
Mr. Isaac Olukayode Fasola is a consummate professional with over 30 years’ cognate experience obtained from Management and Board positions covering banking operations, risk management, credit analysis, insurance, asset management, business strategy/development, performance management and corporate governance. Mr. Fasola previously served as an Executive Director of a commercial Bank in Nigeria. Mr. Fasola holds 2 MBAs and is pursuing a Ph.D. in Business Administration.
Mr. Abdulqadir J. Bello, a Chartered Accountant, has over 30 years’ corporate experience in the banking sector, during which period he held several senior Management positions in various Banks. He also previously served as the Group Chief Credit Officer of UBA and thereafter as the Executive Director in charge of Risk Management for UBA Group.
BIG STORY10 hours ago
I Have ‘Medicine To Defeat Godfather Terrorizing Lagos’ —- Saraki Boasts
NEWS2 days ago
Police Deploy 300 Patrol Vehicles, 2 Helicopters, 30 Armoured Tanks For Osun Election
BIG STORY2 days ago
God Has Prepared Me To Be Next Lagos Governor — Sanwo-Olu
BIG STORY2 days ago
I Can’t Be Impeached, They Don’t Have The Number —- Saraki Boasts
NEWS2 days ago
Don’t Let Fayose Escape From Nigeria, EFCC Writes Customs
BIG STORY2 days ago
Fayose Attacks EFCC: Putting My Name On Watch List Political, Petty