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All of these internal issues were further escalated with regulatory fiats by the Central Bank of Nigeria (CBN). The apex bank tried to put a lid on cryptocurrency trading by banning banks from providing an enabling platform for customers trading cryptocurrencies via their bank accounts. As history has shown, over-regulation has always been a major driver of innovation. Within this time, the debate got renewed afresh on what the fate of traditional banking will be in Nigeria going forward. And as no feasible alternative has been propositioned at scale yet a few innovative platforms have shown promise in the possibilities that modern banking holds for Nigeria. It is for this innovative promise in modern banking that, Flutterwave, a 5-year-old payment infrastructure now has a higher market capitalisation than Zenith bank and GTBank – the two largest banks in Nigeria. In 2019, Flutterwave launched Barter – a virtual card that offers digital payments between Africa, China and most other parts of the world. Barter now has over 500,000 users. If for nothing else, this is a testament to the shift towards these unconventional banking platforms where transactions do not have to happen within the constraints of a banking hall.
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Other players working directly in the banking space are Alat (an online banking product of WEMA bank) and Kudabank. From the convenience of a smartphone, a fully functional bank account can be opened and operated just by downloading and using the Kudabank app after being activated with a BVN. Companies such as Renmoney, Carbon and several others are also giving out salary advance, overdrafts and loans to customers who do not have to worry about providing collateral. One other innovation changing banking culture in Nigeria are dedicated savings platforms such as PiggyVest, CrowdyVest, and others offering alternative savings models whereby a fixed amount is deducted directly from bank accounts of subscribers and locked towards a savings target. The fairly high interest promised and delivered is a major attraction to the young bankable population who are looking for alternatives to piggybanks and cooperative societies. While some of these large youth customer bases are merely storing value by buying cryptocurrencies, others actively prevent the country’s fast-rising inflation from eating away at their Naira by saving in high-interest yielding platforms paying as high as 14% per annum. These bypasses have turned into very popular hacks within upwardly mobile circles. And as these non-core banking platforms hack away at the features which make old banking platforms tick, so are traditional banks losing promise and ordinary Nigerians migrate away to experience banking convenience and efficiency. With a burgeoning youth population in Nigeria armed with smartphones which they have deployed countless times for world-changing stuff, it is safe to say Nigerians are no longer comfortable with the inefficiencies which they experience daily with national governance. While all of the possibilities of modern banking are yet to be explored in Nigeria, these few innovations via modern banking systems have become an escape and they will further catalyse the fate of youths fighting the limitations of a developing society. Source: TechCrunch Featured Image Source: Wealth And Finance International
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