By Peter OBIORA InvestAdvocate Wednesday December 04, 2013
Uyo (INVESTADVOCATE)-The Nigeria Deposit Insurance Corporation (NDIC) Wednesday said it will provide insurance cover for mobile banking customers from 2014.
Umaru Ibrahim, Managing Director/Chief Executive Officer (MD/CEO) of the Corporation made this disclosure at a question and answer session after his keynote address at the annual workshop for Business Editors and Finance Correspondents Association of Nigeria (FICAN) with the theme “Deposit Insurance and Financial Inclusion” in Uyo South South Nigeria.
Ibrahim said the NDIC and Central Bank of Nigeria (CBN) are working out modalities to ensure that mobile banking customers in Nigeria are protected.
According to him, the initiative is in line with the Corporation’s efforts to attract and retain poor and unbanked people into the formal financial systems.
Ibrahim said that access to formal financial services is a big problem in the world, “ there are about seven (7) billion people in the world and global financial inclusion database hosted by the World Bank says only 50% of adults have accounts at formal financial institutions-bank, credit union, cooperatives, post office or microfinance institution. This implies that 3.5 billion people are financially excluded,” he said.
He affirmed that working towards full financial inclusion is an ongoing and dynamic process, “the ability of the market to respond to this demand depends not only on providers developing sustainable and low-cost ways to providing such services, but also on having an enabling regulatory and supervisory environment backed by an effective deposit insurance system,” Ibrahim affirmed.
The NDIC Chief further affirmed that the Corporation supports through guaranteeing deposits, especially small savers.
He said deposit insurance is vital in financial inclusion because the poor need assurance that services of depository institutions are safe and available.
According to Ibrahim, plans are underway by a committee set up by both the NDIC and CBN to fashion out ways to identify customers of unclaimed insured deposits in the failed banks, for such deposits to be paid into their secured accounts.
He said due to the small value of some of the deposits, customers are unwilling to respond to the call by the Corporation to come for payment of their deposits.
The NDIC CEO said a number of banks have been listed and both the CBN and NDIC are currently collaborating with other stakeholders and have consulted with some countries and jurisdictions on how to find out what level of funds can be insured. “Is there anything as mobile money? If so what do you consider as deposits?”he asked.
“So sometime in 2014, we will rollout cover for mobile banking,” Ibrahim said.
