Categories: Business

Safety of deposits, insurance cover for Nigerian PSBs assured —NDIC

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3 years ago

Bello Hassan, NDIC MD/CEO

THE Nigeria Deposit Insurance Corporation (NDIC) has promised that it will continue to provide insurance cover to depositor’s funds including the newly licensed Payment Service Banks (PSB).

The corporation, on its official twitter handle, described Payment Service Banks as the newest type of banks in Nigeria created by the Central Bank of Nigeria (CBN) to enhance financial inclusion and increase access to financial services to the unbanked.

According to NDIC, there are currently five PSBs licensed by the CBN and insured by NDIC but only two have commenced operations. They are; Hope PSB and 9PSB as at May 18, 2022.

Two weeks ago, the Central Bank of Nigeria (CBN) gave approvals in principle (AIP) to two of Nigeria’s most prominent telecommunication companies, MTN and Airtel. With these AIPs, the subsidiaries of these telcos – MoMo and Smartcash – became Payment Service Banks (PSBs).

However, some analysts said with MTN’s 630,000-army of agent bankers and a new PSB licence, retail banking is about to change for many Nigerians. For instance, in Ghana, MTN offered as much as a seven per cent interest rate on savings, higher than the average four per cent offered by banks.

According to analysts, the CBN hopes the new PSB Licences would drive financial inclusion, stressing that it would, but only at the access to payment or savings levels. Insurance, pension or credit might continue to lag, stifling the potential for economic growth.

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