According to a study conducted by the Africa Practice Inclusion for All initiative, an advocacy program aimed at removing barriers to financial and economic inclusion for Nigeria’s poorest and most vulnerable populations, identity (ID) ownership is linked to income level.
According to the study, impoverished and vulnerable communities are the least likely to have identification, and awareness and comprehension of the barriers this causes to financial inclusion and credit are developing.
The National Identity Number (NIN) enrolment, on the other hand, has increased by 67 percent in the last ten months, according to the research.
According to the World Bank Group, one billion individuals worldwide lack an officially recognized form of identity, with low-income nations bearing the brunt of the problem. Despite the National Identity Management Commission’s (NIMC) remarkable acceleration in ID enrolment over the previous 12 months and a robust strategy to attain ID inclusion for every Nigerian, there is still more work to be done.
By August 31, 2021, NIMC had recruited more than 63 million Nigerians with National Identity Numbers (NINs), up from 42 million in October 2020, demonstrating significant progress. However, a large proportion of Nigerians lack a form of legal identification, and the majority live below the World Bank’s poverty line.
The Africa Practice research focuses on identifying possibilities to promote financial inclusion by better understanding the relationships between income level, identity ownership, and financial inclusion.
According to the 2020 Access 2 Finance survey done by Enhancing Financial Innovation and Access (EFInA), 36 percent of Nigerian adults, or 38 million people, are entirely financially excluded, while 59 million Nigerians are unbanked. Of these, 73% lack the necessary identification documents to open a Tier 3 bank account.
According to the Africa Practice study, the poorer people are, the less likely they are to have an ID. The number of persons who cite identification as a major obstacle to opening a bank account or obtaining credit climbed significantly in 2020, according to the report.
“The poorest excluded populations are most often the hardest to reach, and can be the most resistant to participation, but stand to gain the most from the range of government and financial services that inclusion enables,” it says.
“The pace of identity enrolment in Nigeria has accelerated substantially in 2020 and 2021, with more than 21 million Nigerians registering, and is a tribute to NIMC’s approach and government’s focus on the issue,” Africa Practice Director Tim Newbold stated. We must keep this momentum going and guarantee that NIMC meets its enrollment goals for the groups that need it the most — the excluded and disadvantaged. We look forward to working together with all stakeholders to meet Nigeria’s identity and financial inclusion goals, which will need creativity, expertise, and commitment.”
Chinasa Collins-Ogbuo, Programme Lead for the Inclusion for All initiative, said: “It is clear that the poorer you are, the less likely you are to have ID, and that this is increasingly being recognised by Nigerians as an obstacle to accessing financial services, particularly credit. During the Covid-19 pandemic, we know that demand for formal credit amongst vulnerable communities increased. There is an opportunity here, to focus targeted interventions on those communities where demand exists, to help them participate in the formal financial system and access the credit they need. This is going to be a core focus for us going forwards.”
SOURCE: VANGUARD NEWS
