NDIC, financial inclusion and the media

By Suleiman Uba Gaya

It has since become an annual ritual. As the Nigeria Deposit Insurance Corporation (NDIC) gets set to host this year’s workshop for business editors and finance correspondents in Nigeria, one thing that has remained dear to the management is financial inclusion and saving the deposits in unsafe places of 72 million Nigerians who don’t have bank accounts and don’t engage in any banking business.
There are other key issues bedevilling the Nigerian economy that are crying for attention, including ensuring a better deal for the 53 percent of Nigerians currently in the banking system, and why 90 percent of bank deposits are owned by only 2 percent of the population. As has been the tradition over the years, one can bet his last kobo that some of these issues are going to be discussed – and addressed – at the NDIC-Media workshop in Kano at the weekend.
In Nigeria today, there is hardly a governmental organisation that has been engaging the media and training its business editors and financial correspondents like the NDIC does. Since his assumption of office about seven years ago, NDIC Managing Director/Chief Executive, Alhaji Umaru Ibrahim, has placed capacity building on the front burner, training his members of staff in areas of need at home and abroad. And just as he desires financial inclusion for the non-formal sectors of the economy, he has gone a big step further by ensuring capacity building is extended beyond the four walls of the NDIC building, expending time and resources to train business editors and correspondents covering not just the deposit insurance aspect of the economy, but the financial sector in general.
The NDIC must have realised that no organisation can truly succeed and achieve its mandate without partnering with the media. This must have informed why in a recent interview with newsmen, the NDIC boss pointed out that “the media remains a critical and strategic stakeholder in our quest to mould fresh perception amongst our key stakeholders as well as stamp our core mandate of deposit protection in the minds of our teeming depositors through enhanced service delivery.”
One issue that has remained key to the managing director is financial inclusion; the protection of not only depositors in the formal sector of the economy, but even those in the informal sector, as well. “s we crave your role and support in the promotion of financial inclusion in order to attract the unbanked poor to formal financial systems through various workshops, we equally like to seek your partnership toward cascading the philosophy and objectives of the new NDIC brand to our numerous stakeholders”.
The partnership that the NDIC has continued to deepen with the Nigerian media has created awareness on its mandate, as well as on its vision and mission. It has also made the NDIC the best deposit insurance organisation in the whole of Africa. Even at that, the Ibrahim led management is not resting on its oars. It has since set its sights in becoming the best global deposit insurance outfit. It is an ambitious target, but one that is doable.
One wonders what will have become of the Nigerian economy without the NDIC, or specifically without the visionary leadership it currently has in place. Every year, for example, hundreds of billions of naira are saved through the diligent supervisory role the organisation plays on deposit money banks. It does not just fold its arms and wait to intervene when a bank goes under. It as much as possible prevents the bank from collapsing. And it is a testimony to the excellent work the management is doing that the incidences of failed banks are fast becoming forgotten issues in the Nigerian economy.
With the clear example shown by the NDIC in ensuring diligent prosecution and conviction of bank chief executives whose antics led to unfortunate collapse of over 45 deposit money banks, management of bank mostly execute their jobs professionally, with banks engaged in healthy competition to attract deposits from millions of customers.
As the NDIC has been explaining, the role of the banking sector, the financial safety net, and other financial institutions that accept deposits from the public are important in the economy because of their involvement in the payments system, their role as intermediaries between depositors and borrowers, and their function as agents for the transmission of monetary policy.
By their nature, banks are vulnerable to liquidity and solvency problems because they transform short term liquid deposits into longer-term, less-liquid loans and investments. They also lend to a wide variety of borrowers whose risk characteristics are not always readily apparent. The importance of banks in the economy, the potential for depositors to suffer losses when banks fail, and the need to mitigate contagion risks, lead countries to establish financial safety nets, such as the NDIC that has been serving and saving the largest economy in Africa.
It is hoped that the current management of the NDIC will continue to sustain its all-important partnership with the Nigerian media and even deepen it, to continue helping the Buhari administration achieve its goal of making life better for all Nigerians.

Gaya is Deputy President, Nigerian Guild of Editors

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