FSI’s drive to rethink tech innovation in Nigeria

FSI provides a platform for young innovators to leverage technology in solving real-life problems in key sectors of Africa’s economy. EHIME ALEX writes on its award of N2.5m to winners of this year’s hackathon

Team Wakanda, on Thursday, was awarded the first prize in the Financial Services Innovators and Nigeria Association of Computing Students’ Innovative Challenge, tagged ‘#TechonDemand’ hackathon.

The team emerged the winner from the 10 teams that made it to the final stage, winning the N1m star prize, after a hot-seat experience pitching their ideas to the judges relative to the problem statement set by the organisers.

The organisers had set N2.5m prize money for grabs before the 132 teams that registered for this year’s event.

While Team AAU won the first runner-up prize of N500,000, STEMInnovators, the second runner-up, bagged N300,000.

FSI’s drive to rethink tech innovation in Nigeria

FutureTrek, The Bells Team, Start Vest, GodHands, Halal Invest, Team KPT and Adashi, who came 4th to 10th positions in that order, got a consolation prize of N100,000 each.

This year’s FSI and NACOS Innovative Challenge was meant to provide digital solutions to dominance of cash transactions, manual processes and access to financial services among retailers, micro, small and medium enterprises as well as individuals in suburban parts of Nigeria, including university communities and its environs, with particular interest in the digitisation of key sectors such as education, health, financial services and transportation.

The solutions provided were to be inclusive in improving access, removing barriers and lowering costs of Information and Communications Technology usage, thus achieving social, digital and economic inclusion to cashless suburban communities such as tertiary institutions and environs.


Transiting to digital economy

The path to the digital economy is a welcome development for Nigeria. It is said that the country could harness the innovative technology driving financial technology developments around the world.

The global economy is now driven by technology, the Director-General, National Information Technology Development Agency, Kashifu Abdullahi, who led conversations for the closing ceremony, said. “The richest countries are making money from the digital economy, not resources. Innovation is about invention and commercialisation. Invention costs money, but innovation makes money.”

The competition provides the potential for the nation to harness, Abdullahi added.

This year’s Innovative Challenge had gathered thought leaders from the regulatory agencies and corporate entities, tech wizards, academia as well as university students at the grand finale from October 12 to 14, 2021.

In their various presentations, the guest of honour, speakers and students, all noted the need to rethink and embrace drastic change in innovation in Nigeria’s tech ecosystem.


Issues at stake

Nigeria is on a journey to achieve 95 per cent financial inclusion by 2024, away from the 80 per cent the Central Bank of Nigeria set in 2012 when it launched its financial inclusion strategy for the country.

According to the latest report by the Enhancing Financial Innovation and Access, only 64 per cent of Nigerians are financially included while 36 per cent of its adults’ population (about 38 million) are financially excluded. Even as 51 per cent of Nigerian adults use formal financial services, the EFInA report disclosed that a good number of them are under-banked because the services are not tailored to their needs.


Challenges of fintech growth in Nigeria

One of the key factors said to be preventing the sector from achieving its full potential has been that, to date, fintechs have had limited appetite to develop commercially-viable use cases to serve the mass market segment owing to the significant investment required.

But this is changing, in part, as a result of the impact of the Coronavirus Disease crisis, McKinsey and Company said in its latest report. With consumers turning to digital options during lockdown and governments using digital channels to roll out aid packages, it has become clear that there is untapped opportunity to convert the underbanked and unbanked to fintech solutions and unlock the economic and social benefits that this promises.

“Quick and decisive action would allow stakeholders to realise Nigeria’s fintech potential,” it stated.


Leveraging FSI tech competition

Now in its fourth year, FSI set the focus of this year’s challenge to address the issues of the dominance of cash transactions, manual processes and access to financial services among small and medium enterprises as well as individuals in suburban parts of Nigeria.

FSI is poised to create an environment for young innovators to thrive, the Executive Director, Mrs Aituaz Kola-Oladejo, said. She lamented that innovation had yet to be democratised in Nigeria.

“I strongly believe that if we create an enabling platform for young innovators to thrive, we can make Nigeria a global leader in innovative technology.

“I dream of a country where an innovator, despite their background, pedigree, tribe, network or influence, can build a global technology enterprise,” Kola-Oladejo said, stressing that it would involve the active participation of every stakeholder, financial and non-financial institutions, fintechs and government agencies.

We are committed to promoting rapid national growth and providing necessary technical and professional support to technology providers, the President, Nigeria Computer Society, Prof Adesina Sodiya, said.

NCS will continue to support and promote technological development and Information Technology business for sustainable development of the nation, Sodiya remarked.

He added, “Our students, youths, young innovators and startups have potential that can drive this nation smoothly into the future. I am confident that members of NACOS are committed to this and are ready to take this country to a reputable and enviable technological position among nations in the world.”

According to the President of NACOS, Olamilekan Abolade, the group is focused on empowering a new crop of innovative young men and women, who will add technological value to every sector of the economy and solve real-life problems. “We want to use our power as students to push for the rebirth of technology, which is the enabler for adequate innovations and ensuring productivity”.


Need for investment

Nigeria currently boasts of more than 200 fintech companies. Despite the increased activity in the fintech sector and the positive multiplier effect in the country’s economy, there is significant potential for further growth.

According to McKinsey’s data on ‘Harnessing Nigeria’s fintech potential’, fintech accounted for only about ⁷ 1.25 per cent of retail banking revenues in 2019. And while fintech investments in the country grew to approximately $460m in 2019, the majority of which was from external investors, this was only a small fraction of the $36bn invested in fintech globally.

It showed that apart from the support fintech provides in human capital development by driving financial inclusion and literacy, significant opportunities also exist for fintech to enable solutions within education and health to address societal challenges such as student financing, digital learning, and affordable health insurance.

Recently, at the gathering of Nigerian ministers for the Mid-Term Ministerial Performance Review Retreat in Abuja, the President of African Development Bank Group, Dr Akinwumi Adesina, who was the Guest Speaker, said the fintech industry remained one of the industries that would dominate the future.

Adesina, who spoke on ‘Nigeria’s Economic Resurgence: Learning from the African Experience’, noted that digital payments, mobile money accounts, savings, credit, and money transfer would revolutionise businesses.

“Nigeria’s fintech is surging as one of the leaders in Africa today,” he added.

Ehime Alex
Ehime Alex
Ehime Alex reports the Capital Market, Energy, and ICT. He is a skilled webmaster and digital media enthusiast.

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