ABUJA, DECEMBER 9, 2016 – The Central Bank of Nigeria (CBN) Governor, Mr. Godwin Emefiele has said that increased adoption of Digital Financial Services (DFS) in Nigeria has the potential to create three million new jobs in Nigeria by 2025.
Also, for financial services providers, Emefiele said DFS has been estimated to reduce the cost of providing financial services by 80 to 90 per cent compared to the cost of a traditional bank branch.
Emefiele gave the advice in a keynote address he delivered at the 2016 BusinessDay Financial Inclusion Summit in Lagos yesterday. He also advised ministries, departments and agencies of governments as well as firms in the country to further digitise current cash payments.
He noted that the economy is presently going through a time of economic challenges, saying that Digital Financial Services have substantial potential to promote financial inclusion, increase productivity and support economic growth in our country.
Therefore, he urged all stakeholders to step up initiatives to successfully advance the movement in order to achieve the financial inclusion target by 2020 and boost economic growth in Nigeria.
“Digital financial services refer to financial services, such as payments, savings, loan or insurance products, which are provided through electronic platforms, such as mobile phones, the Internet, or electronic cards. Digital financial services can promote financial inclusion, because they are capable of dismantling the existing barriers to financial inclusion.
“One key barrier to financial inclusion, as defined in Nigeria’s National Financial Inclusion Strategy, is the remoteness of access to financial services. Several people do not use financial products because they live too far away from a physical financial access point such as bank branch, an insurance agent or ATM.
“Digital financial services transcend such physical barriers as they can be availed through virtual channels such as mobile phones, which today are ubiquitous. We have noted commendable innovations in the industry today, thereby financial institutions have begun to leverage the mobile platform to open accounts and conduct transactions, enabling existing clients and previously excluded population to access financial services in a more convenient manner.
“Digital financial services can also reduce other barriers to financial inclusion, such as high cost of transaction or transportation costs while also saving valuable travel time,” the CBN governor said.
Furthermore, Emefiele said DFS can also bring about substantial benefits for financial services providers, and can boost the country’s GDP significantly and more sustainably.
For instance, a McKinsey study postulated that digital financial services can increase Nigeria’s GDP by 12 percent or US$88 billion by the year 2025.