The PSB licenses given to Airtel and MTN will play a huge role in expunging financial ignorance in low-income areas.
This was stated by Emmanuel Orji, an analyst on Nairametrics “On the Money” series on Clubhouse while speaking on CBN’s final approval to Airtel and MTN for their respective Payment Service Banking licenses.
According to Orji, quite a number of people do not own bank accounts due to the lack of information or sensitization on the ease and importance of opening an account and most banks are more focused on reaching the already-banked rather than the unbanked percentage of the population.
- He said, “Even with the whole trying to make the bank processes easy as it is now, there is no incentive to pretty much address the ignorance on the streets. We hardly see banks hosting seminars on how to open a bank account in those low-income areas and that is just focusing on those that already have some sort of knowledge about how the banking app and account opening works.
- “I think the PSB license is given to Airtel and also to MTN is definitely going to play a huge role”.
- He also explained that the MTN CFO, during the company’s earnings call disclosed that the company currently has 180 active agents and registered over 800 active agents across different states in Nigeria.
- He stressed that this recent development is a great positive for financial inclusion. He opined that Airtel and MTN PSBs will do more work than fintechs in reaching the unbanked.
- Speaking of Airtel, he said, “Airtel does not have so much coverage in Nigeria, given all the change of hands that we have seen in the past, from Econet to V-mobile and the rest, which has not made it easy for them to have a stronghold. But definitely still going to be a positive move for the company and Nigeria as a whole”.
Another analyst, Olumide Adesina, commented on the PSB licenses stating that even though the service provides options for users, focus should also be directed to the e-naira.
“The major positivity from the consumer point of view is that it gives users many options and that is what financial inclusion is all about. But in the long run, I think we should focus more on the e-naira adoption, the fact that transaction cost is expensive relatively across many platforms especially if you are using overseas or multinational transactions,” Adesina said.
He explained that while we are seeing growing entries in these platforms and telcos, more solid products are still needed.
