The notion supporting digital financial services (DFS), mainly through ubiquitous mobile devices as a magic bullet for enhancing access and utility of financial services is still in its nascent stages. Through research engagements, the various dimensions of Nigeria’s financial inclusion conundrum are the primary focus of the Sustainable and Inclusive Digital Financial Services (SIDFS) Initiative hosted at the Lagos Business School. By generating an evidence base, we aim to provide thought leadership and insights to address the financial inclusion phenomenon across all dimensions of the ecosystem. In 2016, the Initiative published the first DFS State of the Market Report which focused on two pivotal pillars of financial inclusion development and growth – the demand and supply perspectives. By profiling under-banked and unbanked consumers, we identified characteristics of the underserved from the community, through household and individual lenses. The customer segments were profiled using demographic parameters as well as assets (identity, phone ownership/access) and capabilities (language, digital). These profiles are intended to enhance supplier know-how and aid product development capabilities. The in-depth analysis of the supply-side identified three (3) business models for delivering sustainable DFS, namely: focused, specialist or a hybrid. The study went further to describe the portfolio of organisational assets, resources and capabilities to efficiently deliver DFS to under-banked and unbanked consumers. The themes presented in this edition expand the discussion beyond the core ecosystem and provides insights into the institutional frameworks necessary for financial inclusion.
The report addresses the third ecosystem pillar – the institutional/regulatory component, with specific focus on the legislation, policies and regulations. The policy analysis unearthed critical policy constraints and guided by the doctrinal interpretations of existing laws, market-enabling policy solutions evolved. Our presentation focuses on material financial inclusion issues, the guiding laws and solution proposals. This report does not contain legislative bills but forms a premise for the drafting of new laws, policies and regulations. Finally, these market-enabling policies or solutions for creating an ecosystem for delivering DFS to the unbanked require the cooperation and collaboration of public institutions, the private sector and civil society. Financial inclusion for all is a reality when it is a national priority.