Microfinancing Financial Inclusion & Digitization
Micro-financing is still a relatively new concept in Nigeria. The whole idea was initially conceptualized as community banking, though an earlier attempt at recognizing the poor in the official scheme of banking culminated in the establishment of the Peoples Bank of Nigeria. However, the project failed but the lessons from the failure were handy in the processes leading to the formulation of community banking and later, microfinance banking policies, by the Federal Government of Nigeria. The nation, through these initiatives, is gradually progressing in the journey towards the much touted Financial Inclusion.
In the microfinance industry, digitization has attracted both hope and dissatisfaction at various points. In the hopes that it will allow
microfinance institutions to compete on the international scene, particularly in the retail finance sector. Few digitalization projects
have significantly altered the conventional microfinance model, despite huge and resourceful digital investments.
The goal of the microfinance industry and the broader financial inclusion community is to generate value for businesses and
customers through digitization. To provide credit and other financial services to low-income clients, including filling the funding gap for
micro and small companies (MSEs), microfinance institutions play a crucial role.
In the broad and flexible context of digitization, technology plays a major role in the development and provision of financial services.
Using the definition from the book, I was able to find workable digital solutions and simplified the
fundamentals of successful
Microfinancing Financial Inclusion & Digitization
implementation. The established implementation strategy prioritizes producing value for consumers and the business over technological
buildout. For MFIs that use agile product development teams to define and measure value with a strong business intelligence practice,
there is a good chance that their digitization efforts will be successful and beneficial as long as they focus on improving user experience and
prototypes using low-tech tools.
The study is part of a bigger research that looks at microfinance in the digital age in order to gain a better understanding of the landscape and hasten the creation of a more technologically enabled finance
ecosystem.
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