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It’s high time we stopped looking for Change

August 1, 2018

This article is part of a series I will be posting for a month in collaboration with my friend, Olamide Egbayelo. We challenged each other to become better writers and will be posting our articles together once a week.

Think of the last time you were in traffic. Perhaps you saw a vendor with your favourite roasted groundnut or maize. You reach out through the window. The vendor sees you and quickly dashes forward, product in hand. You reach into your pocket but you can’t find that ₦50 you thought you had. The only thing in your pocket is a ₦500 note. You show it to the vendor. Their face falls. They don’t have change. They look around quickly. Perhaps if there is another vendor around, change can be found. Otherwise, transaction failed.

The challenge of looking for change is a well-known one to Nigerians. I can’t count the number of times I have had to buy recharge card not because I really needed it but because I wanted to have change before a keke guy insults me to my grandfather’s generation.

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Not many street vendors and small business owners in Nigeria have a bank account. The world Bank estimates that only 40% of Nigerian adults are banked. Many, especially in rural areas believe they do not have enough money to bother opening bank accounts. Others do not want to incur the additional costs of having a bank account. They argue there is no point opening an account if they have to pay additional transport fares to come to the city anytime they want to make a transaction.

Olamide wrote about the reasons many peeople fail to ask for help. Make sure you read about that here.

A great deal of money changes hands everyday in the informal economy. This money is often unaccounted for and untaxed. No point asking a street vendor how much they make in a day. It’s not like you have a bank statement to measure against. Yet the same group of people could benefit from financial inclusion services, just not necessarily one that involves traditional commercial banks. I’m talking about the fact that most of these traders have GSM phones. Did you notice the trusty Nokia torchlight in her pouch or the cheap android in his front pocket? They don’t have bank accounts but they certainly have phones and in that’s good enough to start.

A few years ago if you wanted to send money to someone in the village, you bought a recharge card and texted them the recharge pin. They then sold this recharge card to a vendor at a discount. In this way, recharge card became a form of currency readily accessible and easy to convert into cash. In short, a primitive lowtech form of mobile money.

The first time I seriously considered the potential of mobile money in Nigeria was when I read a tweet from Gbenga Sesan mentioning that during a recent trip to China, even taxi drivers had refused to accept his cash. They would rather accept payment through China’s premier mobile payment platform, WeChat Pay. No one wanted to deal with the hassle of looking for change.

Imagine if all you needed to have your “bank account” is your mobile phone. With their mobile wallets, customers could easily transfer small amounts to vendors and not have to bother with change. Our earlier transaction would have ended far more successfully if your vendor could have simply whipped out his phone and said “Oga I have x-mobile wallet. You can send me the money.” The keke guy could simply post a barcode on the back of the driver’s seat and you scan it on your way out and transfer the agreed fare to him.

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An ideal mobile money platform would be one where using just your mobile phone, you should be able to create your own unique mobile wallet into which you can deposit money from bank accounts, transfer to other mobile wallets or to bank accounts. There should also be mobile money agents in strategic places where those without bank accounts can turn their mobile wallet credit into cash for a token amount. It saves everyone the stress of looking for change and provides financial inclusion services to small businesses such as street vendors and kiosks.

The idea is one that really deserves looking into in Nigeria. According to the world bank, the number of unbanked Nigerians stands at 118 million. Obviously, creative ways are needed to connect more Nigerians to financial inclusion services. Some companies seem to have already started this. I had a conversation with a staff who works at Teasymobile about their mobile money platform and even checked out their website. Sadly, their platform is yet to capture minds and hearts. Part of this problem seems to be a lack of mobile money agents that can explain how the platform works to people in their local languages, especially in rural areas. There are only four listed agents for Teasymobile in Kano and all of them are located within the metropolis where banks are easily accessible. Rural areas are positively crying for this. Until someone is willing to do the legwork to make this possible, just make sure you have your change ready before you take public transport.

Umar Amir Abdullahi is a young writer who is passionate about social causes and wants to play a role in shaping the minds of the Nigerian youth. He also does freelance writing work so if you want something written and are willing to pay for it, do get in touch.

From → Challenge, Musings

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