NDIC to insure mobilemoney in Nigeria

JUNE 16,2014

Mobile banking subscribers are soon to get insurance cover as the Nigeria Deposit Insurance Corporation (NDIC) is putting finishing touches to an initiative to extend deposit insurance to them.
The Managing Director, NDIC, Alhaji Umaru Ibrahim, who disclosed this at a roundtable discussion on ‘Mobile Payment Services in Nigeria’ in Lagos on Thursday, said each subscriber would be guaranteed up to N200,000 or N500,000 as applicable to Microfinance Banks/Primary Mortgage Banks and Deposit Money Banks(DMBs) respectively, in the event of bank failure.

He noted that if a bank fails, the insured mobile account can be transferred to another sound bank.
This, he stressed, would further engender public confidence in the system, thereby promoting financial stability.
According to him, “The NDIC framework for extending deposit insurance to individual customers of mobile payment services is being finalised.”
Stating that NDIC, as a deposit insurer provides a unique role of enhancing financial inclusion by encouraging mobile financial services, he noted that, the corporation seeks to continuously create awareness and support this mobile payment initiative, so as to give confidence to subscribers, as well as ensuring them of the safety of their funds held in pool accounts in the banks.
Mobile payment, he said, refers to payment services operated under financial regulation and performed from or through a mobile device.
“It is a convenient, secure and affordable way to send money to friends and family using mobile phones and/or other electronic devices like internet facilities,” he disclosed.
Ibrahim stressed that with mobile money, all economic agents can transfer fund to any recipient in the country and outside the country as well as pay for their goods and services, using their mobile phones and other electronic devices.
“Mobile phones, in particular, are an attractive way to promote financial inclusion given their extensive use by the population and global reach. Mobile phones can serve as a virtual bank card, point of sale terminal (PoS), ATM or internet banking terminal. The confluence of banking technologies with mobile telephony leads to wider penetration and holds new promise of financial inclusion for the minority of the unbanked,” he emphasised.
Stressing that CBN issued a regulatory framework for the operation of mobile payments services in Nigeria in 2009, he noted that the apex bank granted licences to 21 mobile money operators in the country.
He disclosed that the transaction volume and value of mobile payments stood at 14,947,600 and N140 billion respectively, as at 31st December, 2013, stating that, this showed increase in the level of acceptance of mobile money, heightened by increased public awareness.