Tech entrepreneur and Founder of VTel, a digital service provider offering e-commerce and value-added services, Mr. Eniola Adenuga says mobile money remains a major vehicle for driving financial inclusion in Nigeria.
As such, he said emerging markets like the country could derive solid value from the many promises offered by mobile money.
A McKinsey report indicates that two billion individuals and 200 million small businesses currently lack access to formal banking services such as savings, investments or access to credit, leaving them vulnerable to predatory lenders and to other concerns.
According to Adenuga, comparing the impressive adoption of mobile technology and internet penetration in Nigeria with the number of active bank accounts in the country shows a clear disconnect.
“When you look at the number of people who have active bank accounts and you look at the number of people who have active mobile lines in Nigeria, you see there is a huge gap there, and where there is there are gaps, there are opportunities to be tapped,” he noted.
Over the past 10 years, mobile money has grown in some regions as an effective tool for financial inclusion.
In several markets, it serves as a traditional financial service, helping millions of people transition from an informal cash economy to a thriving digital economy.
There are now around 316 live mobile money deployments in 98 countries around the world. Ten years ago, that number was 169 in 71 countries.
Adenuga said more and more people are being captured and enjoying the benefits of a digital ecosystem.
He said his company, VTel, has enabled people to transact more by using digital channels more than ever before.
Highlighting the remarkable successes of M-Pesa in Kenya, the VTel boss said more could be achieved in Nigeria through mobile money.
“With mobile money, people can easily send and receive money, even in the most remote villages. No one is left behind and everyone can enjoy the immense benefits of a digitized country and economy,” he said.
With transaction values reaching $1 trillion in 2021, mobile money has taken a step faster than expected for the industry.
According to McKinsey, by being a gateway to huge and largely untapped markets, digital finance like mobile money has the potential to reach more than 1.6 billion new retail customers in emerging economies and increase volume. in personal and business loans of $2.1 billion. .
Currently, Sub-Saharan Africa has the largest number of mobile money users, the largest transaction volume as well as transaction value in the world.
With mobile money, Eniola believes VTel and other digital and value-added service providers stand to benefit from new revenue streams and grow their balance sheets up to $4.2 billion in total.
He said: “By building and innovating around digital finance capabilities, companies will have the opportunity to develop new business models ranging from new forms of more data-driven financial services, micropayments and brand new digital businesses. Existing financial service providers are also expected to reduce the direct costs of their current operations by $400 billion per year.
“There is no doubt that mobile money is an enabler of many other services that can help solve critical socio-economic and environmental issues, such as access to essential public services, maintaining livelihoods and provision of rapid financial assistance to vulnerable populations”.
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