The Nigeria Deposit Insurance Corporation (NDIC) is considering extending the deposit insurance coverage to mobile banking subscribers, with each subscriber guranteed up to the sum of N200,000 for Microfinance Banks (MFBs) and Primary Mortgage Banks (PMBs) and N500,000 for Deposit Money Banks (DMBs) in the event of bank failure, Umaru Ibrahim, managing director/CEO has said.
Alternatively, he said if a bank fails, the insured mobile account can be transferred to another sound bank.
The development is to further engender public confidence in the system thereby promoting financial stability.
Meanwhile, the NDIC framework for extending deposit insurance to individual customers of mobile payment service is being finalized, Ibrahim said on the sideline of roundtable discussion on ‘Mobile Payment Services in Nigeria’ organized by NDIC in Lagos.
He disclosed that the NDIC is also actively involved in promoting financial literacy and supporting agent banking and non-interest/Islamic banking as strategies for attaining financial inclusion in the country in order to improve the economic well being of the Nigerian people who have been excluded in the formal financial system.
Worried that Nigeria is predominantly a cash-based society which is not good for its economy, NDIC reiterates its support to the cash-lite policy of the CBN because of the need to modernize Nigeria’s payment system, reduce the cost of banking services, drive financial inclusion, improve effectiveness of monetary policy, reduce the high security and safety risks, reduce high subsidy, foster transparency and curb corruption and ultimately meet the federal government’s vision 2020.
“I wish to reiterate that the success of this initiative on mobile payment services is imperative to the success of the cash-lite economy and in fostering financial inclusion”, he said.
Dipo Fatokun, Director, Banking and Payment System Department (CBN), expressed concern that with the licensing of 23 Mobile Money Operators(MMOs) the rate of adoption and penetration since inception has not been impressive.
To him, the top three reasons for not using mobile money were lack of trust, lack of know-how, and unreliable GSM networks. Others he said, are: inadequate capital outlay on the part of the MMOs; basic infrastructural challenges; lack of wide-spread agent network; lack of awareness/customer education; interoperability and inter connectivity which according to him is been worked on.
Also speaking at the occasion, Uju Ogubunka, registrar/ CEO of Chartered Institute of Bankers of Nigeria (CIBN) emphasized the need for awareness of mobile payment services among the citizen. He added that the issue of protection is key in mobile payment and one of the areas that needs to pay attention.
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