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A Look at VBank, Nigeria’s Digital Banking App of 2020

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When VFD Microfinance Bank entered Nigeria’s budding virtual banking space with its VBank app in March 2020, it joined the ranks of challenger banks giving mainstream banks a run for their money.

It was launched when consumers were groaning under the burden of high account maintenance fees, hidden bank charges and other difficult regulatory demands. It was also at the onset of the COVID-19 pandemic in Nigeria, which necessitated months of lockdown and restricted movement.

Riding on the back of its attractive and easy-to-use interface, the VBank app quickly racked up hundreds of thousands of downloads on Playstore and the App Store.

The latest update to the app launched earlier in the year with some sterling features to make virtual banking seamless.

Customisable features

The new update on the app comes with a customisable interface that allows adding quick links to the homepage by clicking the edit button on the top left corner of the page. With this, you can add features you use frequently to where you can quickly access them.

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Receiving/Sending money without an account number

The app comes with Proximity Payment, a Bluetooth-like feature. With this, VBank users can send or receive from other users of the app without using an account number. The app uses your phone’s location, microphone and Bluetooth to carry out the transaction.

There is a catch, however: VBank expressly states that “the data being shared is temporarily uploaded to Google in order to enable sharing.”

Closely related to this are the QR code payment and cardless withdrawal options. The QR code feature allows users to initiate and receive payment by scanning another user’s QR code. It also enables the app user to generate a unique QR code anywhere in the world and then share the same with family and friends to receive payments anywhere QR code payment service is available.

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The cardless withdrawal feature enables users to withdraw cash at any ATM in Nigeria without using a physical debit card. And with the ATM locator on the app, you can locate ATM points nearest to you.

One transaction, multiple beneficiaries

Sending funds to more than one person can be a bit tedious and time-consuming, especially when the internet connection is unstable. However, the VBank app allows for making payments to multiple beneficiaries at a go with no hassles and for free. The bank charges zero Naira for transfers all year round.

Investing

With the Invest menu on the app, users can do more than save money. The menu allows users to create target savings, fixed deposit and shared/joint accounts, and also request a loan.

Only recently, the bank reviewed its Fixed Deposit Rates to return between 11.25 and 15 per cent on a 30 to 365 day fixed tenor. This is one of the highest in the country. Also, it renewed its annual Children’s Day Target Savings in May 2021 promising a 20 per cent bonus in the first month and nine per cent in subsequent months provided the same amount is fixed monthly.

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Other regular features

Like many other bank apps, with the VBank app, you can do mobile top-up and pay bills. This would vary from cable bills, electricity bills to betting games.

The VBank app is a digital product of VFD Microfinance Bank which was incorporated in Lagos in 2015. The bank returned 400 per cent in investment in 2020, the year of the pandemic. This is perhaps connected to the timely introduction of its digital app, Vbank, in March 2020, a few weeks before the country shut down. Last April, VBank was named the banking app of the year 2020 at the Gage Awards.

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Banking

London Stock Exchange Lists Ecobank $350m Sustainability Bond

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By Aduragbemi Omiyale

The $350 million sustainability bond issued by Ecobank Transnational Incorporated (ETI), the parent company of the Ecobank Group, has been listed on the main market of the London Stock Exchange (LSE).

The green bond was admitted on the LSE on Wednesday at a virtual ceremony to open the market for the trading day and celebrate the successful listing of the tier-2 environment-friendly notes, the first by a financial institution in Sub-Saharan Africa.

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The bond, which matures in June 2031, has a call option in June 2026 and was issued with a coupon of 8.75 per cent with interest payable semi-annually in arrears.

An equivalent amount of the net proceeds from the notes will be used by Ecobank to finance or refinance new or existing eligible assets as described in the bank’s Sustainable Finance Framework.

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The tier-2 issuance is the first to have a Basel III-compliant 10NC5 structure outside of South Africa in 144A/RegS format.

It was gathered that investor interest for this sophomore Eurobond issue was global, including the United Kingdom, the United States, Europe, the Middle East, Asia and Africa, achieving a 3.6x oversubscribed order book of over $1.3 billion at its peak.

The joint lead managers and book runners in the transaction were Citi, Mashreq, Renaissance Capital and Standard Chartered Bank.

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“The strong global interest in our issuance reflects investors’ confidence in Ecobank’s strategy and our commitment to sustainable financing.

“We thank the LSE for hosting ETI today and look forward to value creation for all our stakeholders,” the Group CEO of Ecobank, Mr Ade Ayeyemi, said.

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CBN’s Digital Currency Will Deepen Financial Inclusion—FDC

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By Adedapo Adesanya

Financial Derivatives Company (FDC) Limited has lauded the proposed plan by the Central Bank of Nigeria (CBN) to introduce a digital currency, saying it will deepen financial inclusion in the country.

In a new report, FDC explained that most central banks had indicated keen interests in developing their digital currencies in response to the threats and limitations of cryptocurrency, including poor regulation, price volatility and facilitating illicit financial transactions.

The report said, “Nigeria is set to follow the global trend as it plans to launch its digital currency by year-end. Unlike crypto, digital currencies are regulated by central banks, thus giving them some level of control over the financial system.

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“On a positive note, virtual currencies would facilitate smooth financial transactions and eliminate bottlenecks associated with the use of cash (mutilated notes, forgery, cash handling charges, shortages). It will also deepen financial inclusion and increase the velocity of circulation.”

The analysis highlighted the rising concerns of distrust in the government and its policies, cybersecurity and inadequate digital infrastructure.

“All these could limit the launch and widespread use of the digital currency in the country,” it said.

According to the report, the drop in inflation rate in May for the second straight month contradicts market reality following the report by the National Bureau of Statistics (NBS) which disclosed that the country’s inflation rate fell to 17.93 per cent in May from 18.12 per cent in April.

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FDC said contrary to analyst expectations, the decline in consumer price inflation seemed to be more of a trend than a blip.

It said the headline inflation fell again in May primarily due to a fall in the food sub-index to 22.28 per cent from 22.72 per cent in April.

This is coming as the CBN last year issued a circular asking commercial banks and other financial institutions to close accounts transacting in, or operating on, cryptocurrency exchanges.

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All deals involving cryptocurrency are now prohibited with severe regulatory sanctions awaiting erring outfits.

The apex bank also asked commercial banks to identify persons and or entities transacting in or operating cryptocurrency exchanges within their systems and ensure that such accounts are closed immediately.

But since the apex bank announced its intention to introduce a digital currency for the country, it has been applauded.

Apart from the FDC, other analysts have submitted that the proposed CBN’s digital currency would benefit the nation, especially as the digital asset is becoming widely accepted across the globe.

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Banking

CIBN to Revamp Banking Practice in Nigeria With A-TEAM Initiative

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CIBN A-TEAM Initiative

By Aduragbemi Omiyale

A strategic initiative aimed to revamp banking practice in Nigeria has been introduced by the Chartered Institute of Bankers of Nigeria (CIBN).

The new plan with the acronym A-TEAM means Accelerated Development; Technology and Digital Enhancement; Engagement for Growth; Accountability and Transparent Leadership and Membership Drive for Value.

As part of efforts for its successful implementation, the CIBN is seeking collaborations with financial institutions in the country.

Recently, the President/Chairman of Council, CIBN, Mr Bayo Olugbemi, visited Ecobank Nigeria and he said the A-TEAM initiative will benefit stakeholders in the banking sector.

He applauded Ecobank’s consistent support for the institute over the years to ensure the realisation of its mandate of determining the standards of knowledge and skills development for those seeking to become members of the banking profession.

“We applaud Ecobank Academy as the first corporate member to become a member of the Global Business School Network and for the consistent support for the realisation of the institute’s mandate of determining the standards of knowledge and skills to be attained by persons seeking to become members of the banking profession.

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“We, therefore, seek Ecobank’s collaboration and enlistment in our Endowment/Prize Awards in any subject of interest; support towards the renovation of Abuja Bankers’ House; support for the establishment of banking museum by donating artefacts and other relevant materials; and to participate actively in training programmes of the institute,” Mr Olugbemi said.

Further, he congratulated Ecobank Nigeria and the Ecobank Group on winning several International awards, which includes the Best Retail Bank in Nigeria by Asian Banker; Africa’s Best Bank for Corporate Responsibility by Euromoney (Ecobank Group); African Bank of the Year (African Banker); Innovation in Financial Services Award from African Banker (Ecobank Group); EMEA Finance African Banking Awards 2020.

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Responding, the Managing Director of Ecobank Nigeria, Mr Patrick Akinwuntan, pledged more support and collaboration with the institute, restating that Ecobank will continue to contribute to the efforts of the organisation to become top class and remain relevant globally.

“For us at Ecobank, we are extremely proud CIBNs efforts at ensuring public discourse on the future of the Nigeria economy and the banking and finance industry.

“This is not in isolation of the ethics, professionalism, accountability, transparency, good corporate governance without losing focus of harnessing the opportunities technology has provided in the new world order. Be assured of our maximum support and collaboration at all times,” he said.

Mr Akinwuntan also identified with the efforts of the institute to raise the bar of competency and capacity building in the industry, stressing that with sound professional conduct, every banker will be held in high esteem.

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He said Ecobank was working assiduously to ensure a majority of its staff become members of the institute, adding that the bank will also provide more mentees and mentors in its mentorship programme.

“We have a medium to long term programme to ensure all Ecobank Nigeria staff become chartered members of the institute.

“At Ecobank, we take human capacity development very seriously. Some of our staff that wrote the last examinations are now chartered members of the Institute.

“We will also ensure bulk subscription of our staff. We will be nominating 30 mentors and 100 mentees to participate in the second mentorship programme,” he assured.

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