Uche Usim, Abuja
In confirmation of the growing popularity of e-commerce in the country, the Central Bank of Nigeria (CBN) on Thursday revealed that 1.4 billion electronic transactions valued at N97.4 trillion were processed in 2017, as against 869 million transactions valued at N69.1 trillion recorded in 2016.
The apex bank also said it was working hard on attaining 80 per cent financial inclusion target of 2020, but identified low financial awareness, low literacy levels and other stumbling blocks that must be dismantled to realize set goals.
The Governor of CBN, Godwin Emefiele, made the disclosure in Abuja at the National Financial Literacy Stakeholders conference with the theme: “Implementing Financial Literacy and Consumer Protection to advance Financial Inclusion in Nigeria”.
Emefiele, who was represented at the event by the Deputy Governor, Financial Systems Strategy, Aisha Ahmad, pointed out that improving financial literacy in Nigeria was very key considering the revolution currently witnessed in the payment system.
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He said: “Today, the financial system is probably the most affected by technological advancement. New digital products and services have emerged and the internet greatly influences consumers’ purchasing decisions as they continue to adopt e-commerce.
“Whilst these developments are no doubt good for the financial system and are expected to aid our financial inclusion efforts, they are accompanied by a myriad of challenges, some of which are
privacy and security concerns, requiring enhanced privacy and data protection for consumers; exposure to new and more inventive fraudulent practices which requires stakeholders to double their combat efforts.
“Others are that consumers are now confronted with multiplicity of information which may lead to information processing errors. As such, concerns around accuracy, reliability of information as well as transparency continue to grow.
“The industry is also faced with an increasing complexity of financial products and services accompanied by consumers’ lack of information or capacity to understand such products and/ or their associated risks. Thus enhanced disclosure has therefore, become very essential”, he explained.
The CBN Governor said the benefits of a financially literate population were immense.
“Consumers are better equipped to make optimal choices in the use of financial products, pose lower credit and default risk, constitute a market for sustainable financial services and products, reinforce competitive pressure on financial institutions for better products and services, and promote financial system stability by increasing market demand and responsible use of financial services.
He, however, called for a strengthened collaboration among all stakeholders, if the pursuit of the nation’s financial inclusion programme is to be successful.
He noted that building inclusive financial systems has become an important objective for policymakers around the world, given the positive effects that financial inclusion has on poverty reduction and enhancing economic prosperity.
“In 2012, Nigeria launched a National Financial Inclusion Strategy and adopted a target to achieve 20% exclusion rate by 2020. The latest Access to Financial Services Survey by EFInA indicates that about 36.8% of eligible Nigerian adults do not have access to financial services. “This is down from 41.6% recorded in 2016. Whilst the improvement is encouraging, there is still considerable work to be done to achieve the overall 20% target exclusion rate by 2020. And the Revised National Financial Inclusion Strategy rightly identifies Consumer Protection and its constituent pillar of Consumer Education as critical to the attainment of its objectives. We also need to implement various policy frameworks”, he added.
Also speaking at the event, the Director, Consumer Protection Department, CBN, Kofo Salam-Alada
emphasized the need to restore trust and confidence amongst consumers if the finance sector is to grow.
“It is for this purpose that the CBN established the Consumer Protection Department and is also leading the Financial Inclusion efforts of the Nigerian government.
“The CBN currently hosts the Financial Inclusion Secretariat (FIS). In 2011, under the auspices of the Alliance for Financial Inclusion (AFI) the ‘Maya Declaration’ was made with the aim of achieving responsible and sustainable financial inclusion, reduce poverty and ensure financial stability. As a signatory to the declaration, Nigeria committed to achieving 80% financial inclusion rate by the year 2020”, he said.