NDIC Reiterates Role in Building Depositor Confidence in Financial System
The Nigeria Deposit Insurance Corporation (NDIC) has reiterated its pivotal role in contributing to the objectives of the National Financial Inclusion Strategy (NFIS) by providing deposit insurance coverage to depositors of licensed banks.
The activities of the NDIC, through the supervision of banks, not only enhance depositors’ confidence in the financial system, but also encourage the unbanked to access the financial services of licensed banks.
A statement signed by the Director of the Department of Communications and Public Affairs (NDIC), Bashir A. Nuhu, observed that the Society has also been at the forefront of the implementation of NFIS in Nigeria as as a member of the National Financial Inclusion Governance Committee led by the Central Bank of Nigeria (CBN).
The Company said it is also part of efforts to further improve the achievement of national financial inclusion goals as the National Financial Inclusion Governance Committee prepares to host the first International Conference on Financial Inclusion. 2022 scheduled for 24-25 November 2022 in Abuja. , Nigeria.
With the theme, ‘Financial Inclusion for All: Scaling Innovative Digital Models’, the conference is the first to be held since the launch of NFIS in 2012. NFIS has set the goal of reducing the percentage of Nigerian adults who lack access to financial services from 46.3% in 2010 to 20.0% in 2020.
“Since the launch of the SNIF, stakeholders have made great strides in achieving financial inclusion goals, which has resulted in a drop in the exclusion rate from 46.3% in 2010 to 35.9% in 2020 .
“The Company has made a significant contribution to the country’s financial inclusion goals by providing deposit protection to all licensed deposit-taking institutions through its deposit insurance.
“It is important to note that a number of financially excluded individuals have failed to join the formal financial system for fear of possible loss of their savings in the event of bank failure, which deposit insurance from the NDIC address,” the statement read in part.
Other areas through which the Company supports financial inclusion include: supervising and resolving failures of licensed deposit-taking institutions, thereby building public trust; enforcing regulatory policies, entrenching enhanced risk management practices to improve financial stability through the Differential Premium Assessment System (DPAS) and monitoring fraud in the banking system, thereby supporting inclusiveness financial; financial literacy, which is key to accelerating financial inclusion.
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In addition to being a member of the Financial Literacy Steering Committee (FLSC) and the Financial Literacy Implementation Committee (FLIC), the NDIC has also undertaken financial literacy education through press briefings, infomercials, radio and television jingles, participation in trade fairs and exhibitions. as participation in World Savings Day, among other things, to promote public confidence.
Recognizing the role of electronic and mobile money as an essential tool for financial inclusion, the Company is extending deposit protection to mobile money subscribers through its Transitional Deposit Insurance.
The NDIC also promotes competition among depository institutions. This is important for fostering financial inclusion, as smaller institutions like MFBs, PSBs, MMOs, with no brand visibility and closer to the unserved/underserved, can compete favorably with larger banks due to protection deposit offered by the NDIC which makes the depositors feel safe and protected.
He noted that the International Conference on Financial Inclusion 2022 provides a unique opportunity to showcase the progress of financial inclusion in Nigeria, highlights other jurisdictional experiences and would serve as a platform for policy makers, financial institutions and other stakeholders to engage on contemporary issues such as innovation. , digital technology and the role of collaboration in achieving financial inclusion for all Nigerians.