The recent shortage of cash and the introduction of the new naira notes has caused so much mayhem in the country. It has affected how the average business transacts, how the nation functions and a significant demographic of Nigerians who operate within rural communities that rely on cash to survive are at a loss during this transformation phase.
This stems from the lack of economy integration that should have been implemented in pilot phases while the old naira is still in circulation. This would create more time for the new notes to be produced and rolled out systematically while the old notes will eventually fizzle out. Things were done too fast, too soon without allowing businesses to make sufficient contingency plans.
Having said this, through this every problem, there is an opportunity that provides a solution. While traditional financial institutions are suffering to meet the demands of their consumers, this has also created a consumer-led opportunity for cashless fintech organisations to thrive, forcing the country to fully adapt to digital innovation, not as option but as necessity.
The digital payment sector has been welcomed as a forward-thinking initiative to boost the country’s economy, ensure seamless transactions, and improve the convenience and experience of banking. However, the sector has been subconsciously segmented to the millennials who are more tech-savvy and globally exposed to international financial payment systems.
While the millennials contribute to a significant portion of Nigeria’s demographic, there is also a demographic of the older generation known as the Generation X (those born between 1965–1980) and the Baby boomers (born between 1946–1964 ) who are not as receptive to change, and adopt the “if it’s not broken, not need to fix it” ideology. These citizens are the loyal to “traditional banking” and with the recent occurrences in Nigeria, they will force them to embrace this digital transformation, which will further create problems and reduce the market share of financial institutions who have invested billions of naira on digital products and services as an added value service.
If you dig deeper, the people are revolutionising the financial infrastructure are the Fintech founders, some of which you’ll find are ex-banking, financial services, or IT professionals have leveraged on the mistakes of their previous employers, closed potential loopholes and developed recession-proof products to tap into a market that is already receptive to the transition to a global financial infrastructure.
To support this further, the type of talent that was highly sought-after took another dimension. While some organisations were working on sustaining existing products and services during the pandemic and post-covid, another portion of businesses were reacting to the trends and gaps in the market and were building consumer-led products which saw a significant increase in the recruitment and demand of Product Managers, UX/UI Designers, Software Developers (both support and development) and Growth Hackers.
There is opportunity here for mobile apps, bespoke payment gateways, and digital ecosystems to really serve their country by providing low-costing commission structures with an emphasis on revenue generation through quantity. There is also an opportunity to cater to smaller SME’s with a universal platform built to conduct a self-serving business, and also room to provide the rural community who may not be tech-savvy but can enrol in an eco tech-platform that is managed for them.
In order for Nigeria to truly transition into a cashless operating economy built for sustainable growth, there must be a unified adaptation of digital transformation across every public sector entity to support the efforts. For example, the public transportation, In the UK, the transportation system has been fully digitalised, so whether you’re tapping your ATM card on a reader to pay for your bus fare or your using Google Pay to purchase your season rail ticket, you can travel seamlessly without any cash. To date, the everyday necessities such as paying utility bills in a digital capacity in Nigeria has been solely pioneered by the private sector; and while they have had success, the bottlenecks of public sector regulations have limited their potential reach.
As I mentioned while the cashless issues in Nigeria are a problem, should we be looking at it as a glass half empty or a glass half full?” Is this present situation desirable? No. But is it a rectifiable problem? Yes, though it may take time. Does the lack of cash limit our daily activities? Yes! but is it also a force for Nigeria to level-up on its potential to adapt an International Financial Instructure and at the same create more jobs to ensure that nationwide digital transformation is sustainable? Absolutely!
