FirstBank: Empowering lives through financial inclusion

Financial inclusion has been identified by several stakeholders as a key enabler of reducing extreme poverty and improving shared prosperity. The ability for economically active adults to save money, send and receive payments, access credit and insurance services through a suitable financial product, and in a sustainable manner is usually the gateway to poverty reduction and attainment of financial freedom. Indeed, financial inclusion is an enabler for at least seven (7) of the 17 United Nations’ Sustainable Development Goals (SDGs). This further underscores the point that significant mileage can be made in shared global prosperity with a marked improvement in financial inclusion levels. Little wonder there has been sustained global attention and focus on financial inclusion in recent times.

This attention has also started to yield remarkable results. According to Global Findex (2021), the global financial inclusion rate improved from 51% in 2011 to 76% in 2021. During the same period, Sub-Saharan Africa’s financial inclusion growth rate (measured by account ownership) outperformed the global growth rate by increasing from just 23% in 2011 to 55% in 2021. Despite this impressive growth, Sub-Saharan Africa still ranks among the bottom three regions globally in terms of account ownership and usage.

While some progress is being made, Africa has traditionally recorded lower financial inclusion levels compared to other regions of the world for several reasons. First, account ownership (the gateway to financial inclusion) level has been low due to a higher poverty rate on the continent. This has greatly limited the propensity to save and thus, the need to open a formal bank account. Likewise, a lower literacy rate (in comparison to other regions) has obfuscated the importance of financial access in achieving financial freedom. The continent has also contended with considerable infrastructural gaps that have made financial services either unavailable or rather expensive for most residents.

However, thanks to increasing focus by various governments as well as the activities of development partners and the advent of technology (particularly, Digital Financial Services [DFS]), most of these challenges are being surmounted to improve the financial inclusion rate on the continent.

In 2012, the governments of Kenya, Malawi, Nigeria, Rwanda, South Africa, Tanzania, Uganda & Zambia made national commitments at the G-20 Los Cabos Summit, and since then, these countries have achieved significant milestones in financial inclusion. Also, activities of development agencies, such as the World Bank Group, have been instrumental in providing critical interventions, data, and partnerships necessary to scale the level of financial inclusion on the continent.

It is worthy to note that the increasing adoption of digital technology in the delivery of financial services has had the greatest impact in narrowing the financial exclusion gap on the African continent. Digital Financial Services have proven to be very useful in three distinct ways:

• *Increasing financial access by lowering the cost-to-serve and thereby making financial services more affordable.

• *Enabling players on the continent to customise and simplify financial solutions to meet the specific needs of the under-banked and unbanked population.

• *Improving access to credit by offering providers creative and innovative credit profiling techniques to better manage the risks inherent in lending to the low-income populace.

In Africa, Digital Financial Services are being employed to deliver financial services along three primary routes: mobile money, agent banking, and digital banking. These delivery routes are uniquely positioned to cater to the needs of the different individual customer segments, taking advantage of advancements in the adjacent mobile telephony sector. Specifically, while both mobile money and agent banking can particularly meet the needs of low-income earners or the unbanked, digital banking (riding on growing internet penetration in Africa) is more suited to meet the needs of the middle to high-income population. The ease of transition from one delivery route to the other has also greatly benefitted all consumers of financial services in Africa.

In Nigeria, due to the strong interplay between government (or regulatory) policies and the aggressive adoption of digital technologies by both incumbent financial services players as well as fintechs, the Nigerian financial services landscape has witnessed tremendous transformation in recent times. The Central Bank of Nigeria (CBN) launched its National Financial Inclusion Strategy in October 2012 to reduce the financial exclusion rate from 46.3% in 2010 to 20% by 2020. Although the nation missed this target by a 16% margin, Nigeria has witnessed significant developments in scaling critical national infrastructural base as well as improving regulatory maturity levels that will facilitate the attainment of the new 5% financial exclusion rate target by 2024.

As the premier financial institution in Nigeria with a rich and successful history spanning over 129 years, FirstBank remains the leading stakeholder that has partnered with the Nigerian government and people to advance financial inclusion in the country. With FirstBank’s extensive digital and physical footprint across the length and breadth of Nigeria, no other player comes close in bringing financial services access and opportunities nearer to the Nigerian people, irrespective of their segment, location, and economic status.

In line with the mission to “provide the best financial services possible,” FirstBank has always sought innovative ways of extending and deepening financial access and making banking more seamless and convenient for the citizenry. In this regard, FirstBank was the first to introduce Automated Teller Machines (ATMs) into the Nigerian market in 1991 and continues to adopt cutting-edge technologies in delivering financial services.

FirstBank has been successful in leveraging innovative technologies to deliver financial services along three main routes – digital banking, mobile wallet, and agent banking.

The Bank’s core digital banking platforms (FirstMobile and FirstOnline), with over 7 million users, offer customers the opportunity to conduct banking services right from the comfort of their homes and offices. Through the core digital banking platforms, customers can access loans, perform account maintenance activities, meet their lifestyle needs, and carry out several other banking transactions without visiting the branch. The Bank’s Super App (Lit App) is also set to revolutionise the Nigerian financial services space upon full roll-out to the public.

FirstBank’s USSD (*894#) platform currently has over 15 million subscribers, allowing the not-too-tech-savvy customer segment to perform banking transactions at their fingertips by dialling unique strings of codes. The USSD channel is particularly suited to rural and semi-urban dwellers where internet penetration may not be as strong as in urban areas. With this channel, semi-literate rural dwellers can send and receive money, purchase airtime, pay bills, and even access micro-loans to meet urgent personal needs. FirstBank also offers the mobile wallet product (FirstMonie) where customers’ telephone numbers serve as a wallet account, enabling them to have access to financial services. This product is particularly helpful to customers who might not be able to meet the minimum documentation requirements necessary to open a formal bank account but who possess a mobile telephone number.

FirstBank’s Agent Banking network is the undisputed largest bank-led network in Nigeria. FirstBank’s Firstmonie agent network operates in 772 of the 774 local government areas in Nigeria, with more than 215,000 agents. At least 63% of the Bank’s FirstMonie Agents are in either rural areas or semi-urban areas where they play crucial roles in bringing financial services closer to the unbanked and underserved communities. The Firstmonie network has cumulatively processed more than NGN 30.17 trillion and circa 1.36 billion transactions since January 2018. The Firstmonie network offerings include account opening, cash deposit, cash withdrawal, airtime purchase, bill payment, government-revenue collection, transfer and disbursement, mobile-money (wallet creations, deposits, withdrawals), bank verification number (BVN) enrollment, and other non-bank ecosystem value-added support services. FirstBank’s Agent Banking network powers economic development in many communities throughout the country, creating more than one million direct jobs. The agents are also empowered to grow their business volumes via a credit facility (Agent Credit), digitally accessed to meet any intra-day cash flow shortages. Agents earn an average of NGN85,000/month in bonus. As a pan-African bank with footprints in seven African markets, Europe, and Asia, FirstBank remains committed to leading the charge in deepening financial inclusion in Africa by providing innovative products that leverage cutting-edge technology to make access to financial services easier and seamless, thereby creating better wealth opportunities and empowering more Africans to attain their full potential.