On 19 and 20 June, our experts from the insight2impact (i2i) facility met with the Central Bank of Nigeria (CBN) in Abuja and the Nigeria Inter-Bank Settlement System (NIBSS) in Lagos to discuss joining forces to test and refine i2i’s needs-based usage approach to measuring financial inclusion, aimed at getting greater insight into how and why people use financial services.

What could be a revolutionary measurement approach could start answering the recent research finding that nearly half of all bank accounts in Nigeria are either dormant or are used only once a month – a finding that highlights the quest for measuring true financial inclusion.

Most adults in Nigeria make one single payment into their account and one single “cash-out” transaction each month – which has caused their accounts to be referred to as “mailboxes”. This highlights that only measuring access to bank accounts, without assessing usage, provides an incomplete view of the actual extent to which financial needs are being met by the use of financial services. It challenges the notion that simply owning a bank account equates to being financially included and calls for more comprehensive measurement of financial inclusion.

Based on people’s financial needs, i2i’s usage approach to measurement focuses not only on whether people have access to financial services (like bank accounts) but rather on how people actually use such financial services to meet their financial needs.

Nigeria is part of a multi-country pilot phase to test and refine i2i’s new measurement frameworks with key stakeholders to ensure they can assist market participants and policymakers in achieving their financial inclusion objectives. The insights generated from this pilot phase will deepen the understanding of consumers’ interaction with financial services and how they derive value from them. This will significantly enhance the current view of financial inclusion.

The i2i team was well received, and both the central bank and NIBSS have indicated their interest in partnering with i2i on this pilot. The details of the proposed joint pilot are currently being finalised. In the meantime, Roelof Goosen, Head of i2i Measurement and one of our experts who attended this meeting, has said: “Our raison d’être is to improve the use of data in the pursuit of the global aim of making financial services available to all in a responsible and sustainable manner. We hope that our journey towards more informative and action-oriented financial inclusion measurement approaches will assist all actors in the financial inclusion world in achieving this. We are excited to continue working with NIBSS and CBN on this in Nigeria.”

If you would like to provide feedback on the measurement framework series, partner with us to test and refine the frameworks, or learn more about our work, please email Roelof Goosen at roelof@i2ifacility.org or our Partnership Manager, Mari-Lise du Preez, at mari-lise@i2ifacility.org.