Nigeria: ‘Poor Identification, Credit Rating , Major Challenges Of MfBs
By Geoff Iyatse, Nigerian Guardian
As Accion Launches Savings Promo
Absence of all-embracing national identification scheme coupled with the underdeveloped credit bureau service is one of the most critical challenges affecting operations of microfinance banks in the country. The challenge is worsened by the Central Bank of Nigeria’s (CBN) insistence that new account applicant must present a valid identity card.
These were some of the observations of Chief Commercial Officer, Accion Microfinance Bank Limited, Nwanna Joel Ezeugo, in Lagos last week at the launch of a savings promo by the bank.
In face of the challenge, Nzeugo said, microfinance banks are trapped between the need to comply with regulatory provision and that of extending financial services to petty traders and small business owners who find it difficult to provide recongnised identification means for documentation.
She said Accion was looking at the possibility of accepting market association identity card, a proposal the institution hopes CBN will approve.
As part of its ongoing campaign on promoting saving culture among operators of the informal sector, Accion has launched a 10-month save and win promo for existing and new account holders. The promo is also extended to holders of dormant accounts.
A customer is expected to make minimum deposit of N10,000 in their account in a month and leave it till end of the month to qualify for a draw to win motorcycle, home theatre, generator sets, refrigerators, plasma television and other items.
There will also be a final draw at the end of the 10-month promo period when a customer could win Kia Picanto Car or tricycle (keke NAPEP). The final draw, which will hold next May, is for customers with N100,000 savings built over a period of 10 months.
Nzeugo explained that the bank was not going into save-and-win promo because it is in short of liquidity but out of its commitment to promote saving culture among its customers. To buttress her point, she revealed that Accion, as at last December, recorded a total loan portfolio of N13b while it plans to hit N19b by end of the year.
The institution, which partners Zenith Bank Plc, Ecobank Nigeria Plc and Citibank, is also said to be concluding plan to issue Automated Teller Machine (ATM) cards to its customers just as marketers will be given Point of Sale (PoS) machines to facilitate quick transaction.