GTCO will continue to make financial services easily accessible—Agbaje
Yvonne Faith Elaigwu is an experienced manager with a proven track record in the financial services industry and in the area of corporate social responsibility (CSR), some of which include the UBA Foundation and the Oando Foundation.
She is proficient in people management, negotiation, business planning, event planning, analytical skills and sales. She holds a Masters degree specializing in Environmental Management from the University of Lagos.
Yvonne Elaigwu is currently Operations Manager at OnePipea leading fintech API company and admin of Open banking system Nigeria. In this interview, she discussed the future of the payment system in Nigeria, revealing the trends that will drive growth in the Nigerian financial technology space.
Could you briefly describe who you are and your professional background?
I studied human anatomy at the University of Maiduguri with the aim of becoming a genetic engineer. Then I found a job! My first job was an operations role and I quickly found that I loved being part of the backend team that provided the support and structure that ensured everything ran smoothly. Every role I’ve held since has been operational in nature. I’ve been doing this for over 12 years in the NGO space, banking, CSR and now in the tech space. Somewhere between these jobs, I completed a Masters in Environmental Management from the University of Lagos.
How would you describe the position of the current payment systems available in the Nigerian trading space today?
I would say that our payment systems are growing and evolving. Transaction volume and value are growing exponentially, PIN transactions alone in 2020 exceeded 235 trillion naira, almost 100 times more than electronic payment transactions less than about 8 years ago. The COVID-19 pandemic has literally forced the world to prioritize contactless interactions and the payment system has not been ruled out. This is probably one of the driving forces behind the growth and adoption of payment by bank transfer; Pay with bank transfer.
About 10 years ago, the value of PIN transactions was 4,449,654, as reported by the Central Bank of Nigeria (CBN), or less than 2% of the 378,100,749 drawn by POS terminals and ATMs. ticket machines. I remember a time when every saloon and convenience store was scrambling to get a POS machine from their banks. It was the new thing and everyone necessary a machine for receiving payments. Both the store owner and the customer relied on the POS slip to confirm that a transaction was successful. Interestingly, these store owners and merchants had bank accounts but had not thought to accept payments directly into them. Today the concept of Pay with bank transfer is so accepted that the taxi driver, who previously only accepted cash (who probably never made it through the POS stage), would without too much delay share an account number to receive payment from its services. Data supports this change and growth, the CBN Electronic Payments Report showed that in 2020 the volume of “pay with transfer” PINs was approximately 200% higher than the volume of payments made at point of sale terminals. vending and ATMs and much more in transaction value.
Businesses are now more comfortable with receiving payments digitally, most businesses today are designed to receive payments digitally, as evidenced by the fact that the transaction value and volume of all electronic payment platforms are constantly growing.
What do you think of digital currencies? Do you think they will end up being implanted in our economy?
I’m no expert on the subject here, but it seems to me they’re here to stay. Like all new “products”, they would come with their teething problems, bugs and losses. Costly mistakes would be made and lessons would be learned. The Moon scenario of the last two days has taught me and I hope the ecosystem that “it’s not really stable unless it is pegged to real money that is in a bank account”. It is like purifying gold, at the end of the day the impurities would be removed and a gem would emerge. While it may take us as a country or an economy some time to get on board with new technology (for example, as was the case with mobile networks and cell phones), we eventually catch up and make up for lost time. I personally believe that once digital currencies become established and become relatively more mainstream, they will be implemented and even encouraged in our country. It would probably take some time, but it’s very likely to happen.
What are the trends that will shape the financial space in Nigeria in the next few years?
I believe the concept of integrated finance will take root and develop/shape the Nigerian finance space in a short time. This would result in close partnerships between traditional banks, lenders and BaaS companies to enable merchants and “regular” entities such as distributors, cooperative societies, farmer associations, etc. to provide financial services to the last mile customer. This would improve financial literacy and bank more customers. The idea is that the farmer who has been “bought” by his farmers’ association will be able to ask this entity for a loan to develop his farm. This entity knows him and his operations intimately enough to offer him this facility. It can be the same with the distributor who buys out his retailers and offers them banking services. What would now start to happen is that last mile customers are becoming increasingly banked, where they are now incentivized to save their funds in the banking system in order to create transaction leads that make them eligible for credit facilities to expand their business and take care of pressing needs.
I also believe that we will also start to see simpler and more secure payment methods as people continue to adopt “payment by transfer”. The data already shows that people are gravitating towards this method of payment and the card transaction failure rate does not complicate matters. In the future, the relevance of card payments would be minimized, thereby reducing the incidences of fraud associated with card payments.
How would you say technology is impacting the financial sector in Nigeria?
With 99% mobile network coverage and 2019 data Jumia report on Nigeria which shows that 87% of Nigerians are mobile subscribers, this means that technology, when properly directed, can be the tool to reach the unbanked and educate the less well off.
The rise and proliferation of tech startups in the financial space is the first glaring way we see technology impacting the financial sector in Nigeria. The prevalence of technology has enabled enterprising Nigerians to create solutions that can change people’s lives. These companies have over the years attracted billions of dollars in capital to the country, provided jobs for thousands of people and in 2021, tech startups contributed around 10% of Nigeria’s GDP. These tech-focused companies create and ship solutions for unbanked and underbanked people nationwide and make them available on progressive web apps, downloadable apps, USSD and POS machines. The odds that an individual in the remote village of Obagaji, Agatu where I come from (where there is no physical bank) with a mobile phone (any type of mobile phone) will be able to access a financial service today are very high and attributed to technology, driven by technology companies.
Technology has made it possible for the ordinary person to have access to resources on financial instruments, concepts and data with which they can make informed decisions to improve their living conditions – everything is a search away on Google.
Digital banking versus traditional banking system, do you think there will be convergence?
Finally, yes. While digital banking is the “now” and the future, traditional banks are here to stay and will have to get to a place (are probably already at that place) where they decide between fighting digital banks, competing with them or associate with them. We are starting to see partnerships in the United States, Europe and even here in Nigeria between traditional banks and digital banks to give rise to the concept of Embedded Finance, which is a relatively new concept. We expect to see more in the future.
As an Operations Manager at OnePipe, what excites you about working in a startup in Nigeria?
The challenge of creating new products and systems; the joy and sense of satisfaction of being part of the birth of something that has the propensity to change lives and influence people and economies.
Give us a practical example of a business that benefited from the successful solution OnePipe delivered?
Omnibiz, a unified distribution platform in the FMCG space has digitized its operations in the wake of the COVID-19 pandemic. Omnibizz worked with OnePipe to integrate financial services so their customers can now pay directly to their retailer’s account. Their retailers can also place orders, track their sales, pay for their orders, request credit and be approved without leaving the digital platform made available to them by Omibizz. This has reduced and will continue to reduce reliance on cash transactions with the attendant risks. It offers transparent payments, an opportunity to bank the underbanked retailer and possible credit to grow their market
What are your winning strategies for managing the people who work with you, both internally and externally?
By default, I treat people the way I want to be treated, I also try to understand people and learn to communicate with them.
In terms of running a successful business, what advice would you give to women choosing to launch startups in Nigeria?
In terms of operations, I would advise you to decide very quickly what kind of business you want to start and find someone whose job would be to help champion that from scratch. When building a startup, operational practices may not be at the top of the list of most important things for the business because you will be building products, finding product market fit, and generally just understanding. With at least one resource dedicated to ensuring you embed standard best practices into your operations and course correct as you go, you are less likely to encounter ironclad operational headaches in the future.