Economy
27% of Nigerian Adults Financially Healthy, 34% Vulnerable—Report
By Adedapo Adesanya
The latest report from Enhancing Financial Innovation and Access (EFInA) has revealed that only 27 per cent of adults in Nigeria are financially healthy.
Business Post reports that financial health is reached when someone has funds in place to meet his short, mid and long-term needs and this could be in terms of income, savings and retirement planning.
In a survey titled The EFInA Access to Financial Services in Nigeria 2020, it was also revealed that 39 per cent of Nigerian adults are financially coping, while 34 per cent are financially vulnerable.
“Nigerians require a range of useful, affordable, and accessible financial services to meet all of their needs.
“Many Nigerian adults continue to rely on different types of providers to meet those needs; while the use of banks increased in 2020, so did the use of unregulated services such as savings groups and village associations,” the CEO of EFInA, Ms Ashley Immanuel, said at the presentation of the report.
It was also noted in the report that Nigeria, which prides itself as Africa’s largest economy, is lagging behind in its target for financial inclusion strategy for 2020, though it said more Nigerian adults are financially included, the National Financial Inclusion Strategy targets were not met.
The method points to strategies used to sets targets for overall financial inclusion, which counts Nigerians that use either formal financial services or informal financial services not nationally regulated, such as savings groups.
The report noted that, “Growth in digital financial services and agent banking highlights opportunities to drive faster progress toward financial inclusion, particularly for excluded groups such as women, rural and Northern Nigerians.
“For the first time, more than half of Nigerian adults are using formal (regulated) financial services.”
The report explained that 51 per cent of Nigerian adults use commercial banks, microfinance banks, mobile money, insurance, or pension accounts, up from 49 per cent in 2018.
“This has largely been driven by growth in banking, with 45 per cent of Nigerians banked in 2020, up from 40 per cent in 2018.
“The overall financial inclusion target was 80 per cent by 2020; EFInA data shows that only 64 per cent of Nigerian adults were financially included by the end of 2020.
“This means that 36 per cent of Nigerian adults, or 38 million adults, remain completely financially excluded.
“In addition, large gaps in financial access remain for some of Nigeria’s most financially excluded groups,” it said.
By gender inclusion, the report showed that women continue to be more financially excluded than men, with only 45 per cent of women using formal financial services, compared with 56 per cent of men.
“Adults in Northern Nigeria continue to be significantly more financially excluded than those in the southern zones, and rural adults are still more excluded than those in urban areas.
Young adults, between the ages of 18-25, are significantly more likely than older adults to be financially excluded.”
While further commenting on the report, Ms Immanuel disclosed that “At our current rate of progress, we will not reach the 2020 financial inclusion targets until around 2030.
“However, we can reach these targets much faster if we follow paths taken by other African countries that have seen rapid financial inclusion growth due to mobile money.
“EFInA’s Access to Financial Services in Nigeria Surveys show that the use of digital financial services and agent networks started to grow significantly between 2018 and 2020. Phone ownership has also increased, with 81 per cent of Nigerians now owning mobile phones.
“Now is the time to build on this initial progress and drive faster financial inclusion growth through digital financial services such as mobile money.
“We can do this by creating an open and the level playing field for a wide range of providers, creating the right environment for fintech to thrive, and encouraging partnerships between different providers.”
She explained further that financial inclusion can benefit individuals, families, and businesses, supporting key outcomes such as GDP growth.
The EFInA Access to Financial Services in Nigeria Survey highlights a significant market opportunity for financial service providers to address Nigerians’ financial needs.
It was noted that only 2 per cent of Nigerian adults are insured, but 18 million uninsured adults say they would be interested in micro-insurance.
Only 7 per cent of Nigerian adults have pension accounts, but 24 million adults without pensions are making regular savings for their retirement. While only 45 per cent of Nigerians are banked, 35 million unbanked Nigerians own mobile phones and could be reached with mobile money.
Mrs Gail Warrander, Economic Development Team Leader, Nigeria for the UK’s Foreign, Commonwealth & Development Office, remarked that “The EFInA Access to Financial Services in Nigeria 2020 Survey shows that Nigeria has made progress on financial inclusion but there’s still a way to go.
“The report models how the journey to the financial inclusion goal can be speeded up by encouraging the scale-up of mobile money.
“I firmly believe that the majority of those excluded, especially women and youth, could then enjoy the convenience of financial services, including using remote payments systems.
“This survey is full of rich data for policymakers, development partners and financial services companies to use,” she said.
Also speaking, the Deputy Governor, Financial Systems Stability (FSS), Central Bank of Nigeria (CBN), Mrs Aishah Ahmad, noted that “financial inclusion is a strong lever for bridging income inequality, combating poverty and preserving social harmony.
“The CBN has accordingly been at the forefront of the efforts to drive financial inclusion in Nigeria by championing the development & implementation of Nigeria’s National Financial Inclusion Strategy led by the CBN Governor.”
The Deputy Governor and Chair of the Financial Inclusion Technical Committee stated that “Despite the progress achieved to date, critical groups remained excluded including women, rural dwellers and citizens in the northern area.
“To address the issue with women, CBN launched a Framework for Advancing Women’s Financial Inclusion in Nigeria in 2020 and is leading the industry to implement the framework, which we expect to lead to a significant increase in women financial inclusion in Nigeria.”
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange rallied by 0.89 per cent on Tuesday, August 4 amid renewed buying interest in unlisted stocks.
During the session, the market capitalisation added N24.07 billion to end at N2.739 trillion compared with Tuesday’s N2.715 trillion, while the NASD Security Index (NSI) gained 40.11 points to quote at 4,563.96 points compared with the preceding day’s 4,523.85 points.
The NASD OTC Exchange ended the trading session with two price losers and three gainers, led by Central Securities Clearing System (CSCS) Plc, which chalked up N7.80 to close at N119.80 per unit versus the previous session’s N112.00 per unit. Afriland Properties Plc increased its value by N1.27 to N23.95 per share from N22.68 per share, and Nitrox Industrial Gases Plc expanded by N1.15 to N21.15 per unit from N20.00 per unit.
On the flip side, FrieslandCampina Wamco Nigeria Plc slid by N8.64 to sell at N144.00 per share compared with the previous day’s N152.64 per share, and 11 Plc dipped by 1 Kobo to end at N225.00 per unit, in contrast to Monday’s closing price of N225.01 per unit.
Tuesday’s trading data showed that the volume of securities rose by 9.0 per cent to 1.6 million units from 1.5 million units, and the number of deals climbed by 6.5 per cent to 33 deals from 31 deals, while the value of securities dropped by 26.9 per cent to N47.6 million from N65.2 million.
At the close of trades, Great Nigeria Insurance (GNI) Plc remained the most traded stock by value on a year-to-date with 3.4 billion units worth N8.4 billion, followed by Infrastructure Credit Guarantee (Infracredit) Plc with 2.3 billion units valued at N6.5 billion, and CSCS Plc with 76.9 million units exchanged for N5.5 billion.
GNI Plc also closed the session as the most traded stock by volume on a year-to-date with 3.4 billion units transacted for N8.4 billion, followed by Infracredit Plc with 2.3 billion units sold for N6.5 billion, and Resourcery Plc with 1.1 billion units transacted for N415.7 million.
By Dipo Olowookere
A 0.38 per cent loss was suffered by Nigerian stocks on Tuesday on the back of continued selling pressure from investors embarking on profit-taking.
Data from the Nigerian Exchange (NGX) Limited showed that the contraction was influenced by the 1.78 per cent decline recorded by the insurance sector, the 0.24 per cent slip printed by the consumer goods index, and the 0.09 per cent drop posted by the energy space, offsetting the 0.75 per cent growth achieved by the banking sector and the 0.21 per cent growth recorded by the industrial goods segment.
Investor sentiment was weak during the trading day, as the bourse ended with 13 price gainers and 40 price losers, representing a negative market breadth index.
LivingTrust Mortgage depreciated by 10.00 per cent to N3.42, Multiverse also shed 10.00 per cent to N22.95, McNichols dropped 9.92 per cent to N5.45, Thomas Wyatt dipped by 9.87 per cent to N3.56, and Eterna lost 8.57 per cent to trade at N33.00.
On the flip side, AVA Capital improved by 9.94 per cent to N9.95, Livestock Feeds expanded by 9.71 per cent to N8.65, Neimeth increased by 8.43 per cent to N9.00, AIICO gained 3.47 per cent to settle at N4.18, and Oando grew by 3.30 per cent to N36.00.
A total of 1.6 billion equities valued at N28.7 billion exchanged hands in 54,160 deals yesterday versus the 923.0 million equities worth N37.9 billion traded in 72,544 deals on Monday, indicating a 73.35 per cent surge in the trading volume, a 24.27 per cent decline in the trading value, and a 25.34 per cent slip in the number of deals.
The busiest stock was Japaul, which transacted 904.4 million units for N2.7 billion. Sterling Holdings sold 54.0 million units valued at N431.9 million, FCMB exchanged 49.5 million units worth N545.9 million, Chams traded 44.9 million units for N199.2 million, and Neimeth sold 42.4 million units worth N327.8 million.
Business Post reports that the All-Share Index (ASI) gave up 927.70 points to 244,802.83 points from 245,730.53 points, and the market capitalisation receded by N599 billion to N158.016 trillion from N158.615 trillion.
By Adedapo Adesanya
The Naira put up a better performance against the United States Dollar in the various segments of the foreign exchange (FX) market on Tuesday, August 4.
In the parallel market, it improved its value by N5 to settle at N1,400/$1 compared with the previous day’s value of N1,405/$1, and at the GTBank forex desk, it appreciated by N1 to close at N1,373/$1, in contrast to the preceding session’s N1,374/$1.
In the Nigerian Autonomous Foreign Exchange Market (NAFEX) segment, the Nigerian currency gained N2.28 or 0.17 per cent against the greenback to quote at N1,362.55/$1 compared with the N1,364.83/$1 it was exchanged a day earlier.
Also in the official market, the local currency appreciated against the Pound Sterling during the session by N6.48 to finish at N1,831.41/£1 versus N1,837.89/£1, and chalked up N5.22 on the Euro to sell at N1,568.71/€1 versus N1,573.93/€1.
Interbank FX transactions increased 14 per cent day-on-day as market makers’ activities raised total Dollar volume exchanged to $156.23 million, more than 132 per cent above $137.05 million in turnover at the previous close.
The interbank FX turnover rose despite a marginal rise in deals at the NFEM window as data from the central bank put Tuesday’s quote at 139 from 138.
As for the cryptocurrency market, major tokens were mixed as global stock indexes hit fresh records on renewed enthusiasm for artificial-intelligence-related shares.
With cheaper oil, easing rate expectations and a strong risk-on rally in equities supporting digital assets, analysts say crypto appears to be driven by internal market dynamics rather than macroeconomic factors, even as traders watch for a potential Strait of Hormuz deal.
It was reported overnight that Iran and Oman were close to an agreement to reopen the Strait of Hormuz, with an announcement targeted for Wednesday.
Binance Coin (BNB) grew by 1.8 per cent to $600.54, Bitcoin (BTC) rose by 0.9 per cent to $64,199.86, Solana (SOL) jumped by 0.8 per cent to $73.95, and Ethereum (ETH) advanced by 0.7 per cent to $1,867.21.
But Cardano (ADA) depreciated by 1.9 per cent to $0.1908, TRON (TRX) dipped by 0.6 per cent to $0.3268, Dogecoin (DOGE) slumped by 0.5 per cent to $0.0698, and Ripple (XRP) crashed by 0.4 per cent to $1.06, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) traded flat at $1.00 apiece.
