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20 years on: Telcos attain 297m phone lines fail on financial inclusion, security.

• Security expert blames network operators
• We provide network information to security operatives, say telcos
• GSMA sees prospect in telco-led mobile money

Despite opportunities the telecommunications revolutions have offered the country this 20 years, especially with 297 million telephone lines connected, insecurity and low financial inclusion remain key challenges yet to be addressed.

The financial inclusion drive of the Federal Government has been slow in leveraging mobile penetration in the country. Besides, efforts to apprehend criminals, especially bandits, kidnappers, terrorists using SIM-based mobile phones appears not to have recorded enough success.

In spite of these gaps, the telecommunications revolution has been eventful. Between January and August 2001, when the Digital Mobile License (DML) auctions were conducted for the rollout of services and August 2021, some 297.3 million telephone lines have been connected with current active GSM subscriptions now about 187.3 million lines.

Whereas SIM registration in Nigeria dated back to about 10 years ago when the Nigerian Communications Commission (NCC) mandated telecoms operators to register all SIMs on their respective network, the impact of this ongoing exercise that has gulped billions of Naira is yet to be felt, as criminals continue to hold victims to ransom.

According to the Enhancing Financial Innovation and Access (EFInA), only 67.5 million (64 per cent) of the 105.5 million adult population were financially included in the year 2020. EFInA also stated that 36 per cent of Nigerian adults remained completely financially excluded as of the end of 2020.

Checks by The Guardian showed that in the same 2020, which was the year of the pandemic, mobile network operators (MNOs), that is the quartet of MTN, Airtel, Globacom and 9mobile, activated 18.6 million new telephone lines on their various networks.

EFInA, in a recent report, titled: ‘Access to Financial Services in Nigeria 2020 Survey,’ revealed that the growth marginally increased from 63.2 per cent to 64.1 per cent in the period under review.

It informed that in 2016, 58.4 per cent of Nigeria’s 96.4 million adults were financially included, comprising 38.3 per cent banked, 10.3 per cent served by other formal institutions and 9.8 per cent served by informal service providers.

The survey noted that in 2020, the most populous black nation had planned to capture 70 per cent of its adult population in the formal financial services sector and 10 per cent in the informal sector, but the novel coronavirus dealt a great blow to the mission.

Giving more insight, EFInA’s Chief Executive Officer, Ashley Immanuel, observed that amid the challenging economic circumstances, financial inclusion continued to grow incrementally, with more than half of Nigerian adults using formal (regulated) financial services for the first time.

She said, at the current progress rate, the National Financial Inclusion Strategy targets of 2020 would not be met until around 2030. Immanuel, however, submitted that the country could achieve the goals much faster if it followed paths taken by other African nations, especially their mobile money strategies.

Indeed, mobile money, which should have given a fillip to financial inclusion in Nigeria, owing to the huge number of mobile phones in the country, refused to gain traction.

Though, the forecast is placing smartphone usage in Nigeria at 140 million by 2025, with an assurance that more people will turn to these devices for social and profitable reasons, the success story of India’s financial inclusion drive, which leveraged the use of smartphone, holds lessons for Nigeria.

Over 332 million Indian citizens have already opened mobile phone-based financial accounts under the government’s mass financial inclusion programme, Jan-Dhan Yojana. As a result, the share of Indians with at least one financial account has more than doubled to 80 per cent since 2011.

The Global System for Mobile telecommunications Association (GSMA) observed that while Kenya boasts of 66.6 million mobile money accounts; South Africa, 41.5 million; and Ghana 34.3 million, Nigeria trails with a paltry 15.3 million. The reason is not far-fetched, if the explanations of the GSMA are anything to rely upon.

GSMA believes that anywhere mobile money thrives, it is always led by the telecommunications companies. Unfortunately, Nigeria’s operation is bank-led rather than telco-led. There are only two telecom operators, Globacom and 9mobile among the hordes of mobile money service providers in the country, which are majorly banking institutions.