Nigeria’s financial inclusion rate climbed to 74% in 2023, up from 68% in 2020.
This resulted from initiatives to provide financial services to millions of Nigerians, nonetheless, some challenges limited certain regions and demographics.
The survey revealed commendable progress in banking penetration, mobile money usage, and credit accessibility.
Notably, Kogi State leads with 94% of its residents having access to formal financial services, followed by Lagos (91%) and Ekiti (77%).
In contrast, states such as Borno (13%), Yobe (22%), and Sokoto (22%) show wide differences, pointing to some impediments in underserved areas.
EFInA’s report reveals that 64% of adults now use formal financial services, an increase from 57% in 2020. Mobile money adoption surged from 2% in 2020 to 12% in 2023, accompanied by a 30% rise in financial agent usage. These digital improvements help in extending services to hard-to-reach populations.
However, while 79% of men are financially included, only 70% of women enjoy similar access. Rural exclusion is also an issue, standing at 37%, compared to 17% in urban areas. These gaps stress the need for targeted initiatives to ensure equitable progress.
Key Drivers of Financial Inclusion Growth
Several initiatives have bolstered Nigeria’s financial inclusion:
- Digital Financial Services: The rapid expansion of mobile money platforms and financial agents has helped in reaching underserved areas.
- Targeted Programmes: Schemes like the Anchor Borrowers’ Programme and COVID-19 relief loans encouraged account openings and enhanced banking penetration.
- Education and Connectivity: High literacy rates in states like Kogi and mobile phone ownership (99%) have contributed significantly to financial access.
Challenges
Not overlooking the challenges, financial exclusion is still high in conflict-affected regions such as Borno (68%) and Zamfara (57%). Added to this, informal financial systems are prevalent in states like Ebonyi (37%) and Benue (24%), where formal services are less accessible.
The survey also revealed disturbing financial vulnerabilities:
- 76% of adults cannot raise ₦75,000 for emergencies within a week.
- 74% experience food insecurity, and 66% struggle with medical expenses.
Opportunities for Growth in Financial Inclusion
To increase financial inclusion, EFInA recommends:
- Expanding digital and mobile money services to remote areas.
- Enhancing financial literacy campaigns, particularly targeting women and rural dwellers.
- Developing affordable, tailored financial products for underserved groups.
Closing the Gap
The progress in states like Kogi and Lagos shows that achieving across-the-board financial inclusion is possible with strategic efforts. However, replicating this success in less-developed areas will require addressing infrastructure deficits, promoting financial literacy, and fostering public-private partnerships.
EFInA’s report calls on policymakers, financial institutions, and development stakeholders to collaborate in bridging the gaps. With collaboration, Nigeria can achieve its goal of universal financial access, ensuring economic empowerment for all citizens.
