ICYMI: Highlights from the 2021 International Financial Inclusion Conference

December 1, 2021 was an exciting day of presentations, discussions and debates at the International Financial Inclusion Conference, organised by Lagos Business School and Business Day.

The conference brought together business leaders and financial inclusion experts and enthusiasts from all over the country and beyond to explore the role of strategic alliances and partnerships in the financial inclusion effort.

Ivo Jenik, Senior Financial Sector Specialist, CGAP delivered a compelling keynote address on the conference theme — Strategic Partnerships & Alliances: Critical Factors for Moving the Financial Inclusion Needle.

He highlighted the impact technology is having on finance, particularly the modularisation and embedding of finance which is creating a new generation of winners while sidelining those unable to make the paradigm shift. This global phenomenon where we see major funding being channeled into fintech signals that a new age of banking and finance as we know it is upon us. Even the market structure of digital finance is becoming more and more modular, and is giving rise to new types of partnerships that are flexible and customisable.

Download his presentation here.

Next we had the launch of the 2021 State of Market Report.

The report, which contained over a year’s worth of research, presented evidence-based insights, identifying partnership opportunities that can drive customer acquisition, enhance the customer experience through digital and physical infrastructure, and enrich customer value propositions.

The consumer insights section concludes with a presentation of product opportunities for 3 customer segments — rural dwellers, women and youths.

Based on an industry wide survey, the report also curates a list of the most pressing challenges FSPs face when trying to initiate or manage effective partnerships with other operators within the ecosystem. These challenges include a dearth of capacity and experience managing partnerships, inadequate succession planning, internal reorganisation, poor partner fit among others.

Download the report here.

There was a Fireside Chat with Major Ashish Ahuja, Chief Operating Officer, Fino Payments Bank India. The conversation focused on critical success factors for successful partnerships.

What made Fino Payment Bank so successful in India was the permission given to them by the Reserve Bank of India (India’s Central Bank) to partner with other entities within the space and beyond. Thus, even though they are not permitted to directly provide certain services (like loans), their partnerships with commercial banks, other financial service institutions and third party providers enabled them to offer their customers a wide range of services via a referral system.

Major Ashish also highlighted the importance of end-to-end ownership of the customer which positions the provider in a place of strength when seeking out partnerships. Also, serving the low income market, the payment bank found significant success by using a subscription model for their products and services. He also shared a major insight about serving the low income segment — they hate surprises especially when it comes to fees and how much they will be charged for particular products/services (highlighting their low trust in formal financial services). Transparency is therefore critical when serving this customer segment. It is also important to keep the cost-to-serve as low as possible, since this customer segment is also price sensitive, hence the reliance on technology to enhance speed and convenience.

He also reinforced the belief that no provider has all the competencies required to deliver all the products customers need. Hence, when the cost of creating or delivering a particular product/service in-house is high, a partnership with another capable and experienced entity is the most efficient solution.

But perhaps the most important takeaway was this: partnership is not a one-off event. It has to be a culture. FSPs with a Do-It-Yourself philosophy would struggle to have efficient partnerships. When an FSP has a history of working successfully with other players, the results are exponential as it builds in-house capacity, as well as enhances their synergy working with other stakeholders.

The fireside chat was followed by a panel discussion, titled, Cant We All Get Along? Partnerships and Strategic Alliances for Financial Inclusion: Identifying Opportunities and Critical Bottlenecks. Panelists included

• Mr Ini Akpan, Country Manager, Opay Nigeria
• Ms Mamie Kalonda, CEO, FINCA DCR
• Ms Tomilola Majekodunmi, CEO, Bankly
• Dr Paul Oluikpe, Associate Head, Financial Inclusion Secretariat, CBN
• Mr Akinbulejo Onabolu, Senior Manager, Partnerships and Alliances, MTN Nigeria

Some takeaways from the discussion include:

Self interest is the bane of partnerships. As self interest rises, trust diminishes among partners and the partnership itself suffers.

When entering into business with other players, it is important to define the role of the other party — are they partners or vendors? Because both relationships are treated differently. This definition helps everyone within your organisation understand how best to relate with the other player.

Having a shared vision and, perhaps more importantly, a shared social mission, is imperative when seeking out partnerships with a financial inclusion objective.

Financial inclusion is too big and too important to be led primarily by the private sector or even by the CBN. Financial inclusion needs to become a federal and state imperative/agenda. There’s a huge disconnect between the policies we see in the regulatory landscape and the rhetoric of advancing inclusion. It is possible that the government is yet to understand the benefits and potential impact of financial inclusion on economic development, employment, taxation, etc. Thus, more advocacy (and a stronger case) is necessary to connect financial inclusion with economic growth + development.

The Closing Remark was delivered by Mr Frank Aigbogun, CEO of Businessday Media. He reiterated the fact that financial inclusion is not CSR but rather a veritable tool for advancing and developing society. He also reminded the audience about the need to be resilient despite the apparent minimal progress in financial inclusion over the last few years.

It was a very informative event, rich with insights, intuitive ideas and exciting conclusions on possible ways to make partnerships more effective at achieving mutual goals and advancing financial inclusion.

We look forward to doing this again next year.

Watch the recording of the conference here.