By Jude Y. Okechukwu
LAPO MFB was recently named the best financially inclusive microfinance bank of 2022 at the International Financial Inclusion Conference organized by The National Financial Inclusion Steering Committee (NFIS), supervised by the Central Bank of Nigeria (CBN). This is a big deal, considering the importance of financial inclusion to developing countries like Nigeria.
Increasing financial inclusion means helping more individuals and businesses have access to useful and affordable financial products and services that meet their needs, such as transactions, payments, savings, credit and insurance, etc., in a responsible and sustainable way. Furthermore, financial inclusion has been identified by the World Bank as a key enabler to reducing extreme poverty and boosting shared prosperity, and also to achieving the 17 sustainable development goals.
In Nigeria, like most developing countries, it is typically MFBs like LAPO, that provide sustainable finance to small business owners who contribute 48 percent of the country’s national Gross Domestic product (GDP), yet suffer limited access to commercial banking services. Therefore, it is commendable that LAPO MFB, Nigeria’s largest microfinance bank is excelling in the drive for greater financial inclusion.
LAPO MFB’s progress in financial inclusion appears to be a natural outcome of its approach to providing financial services. The institution offers various products and services tailored to specific population segments, while taking into account the needs, aspirations and challenges of these population segments.
A review of LAPO’s offerings reveals a bouquet of financial products and services for various groups: widows, farmers, school proprietors, transporters, female entrepreneurs, among others. For each of its loans, the bank also advertises sustainable terms that make them more attractive than those offered by commercial banks.
The bank notably prioritizes women among the various population segments it serves, with up to 90 percent of its customers being women. This focus is in line with research on the positive effect of greater financial inclusion among women. Studies show that boosting the financial inclusion of women increases the contribution of women and women-led businesses to the economy, and enhances the management of women’s personal and household resources.
It is also noteworthy that LAPO clearly demonstrates initiative in providing financial services in the face of various disruptions and difficulties that arise in the Nigerian economy. For instance, the bank rose to the occasion when the Covid-19 pandemic struck, leaving low-income Nigerian households the worst affected, and Microfinance institutions being automatically required to increase support to their customers.
LAPO responded by launching special loans to help parents pay their children’s school fees, and other products to support business owners to sustain their operations in spite of the pandemic, among others. The bank took other practical measures to support its customers and the larger public, such as the distribution of food and other relief items, driving Covid-19 awareness programs on traditional and digital media platforms, etc.
These efforts are especially commendable as MFBs, like most businesses, have also suffered negative effects of the pandemic. A survey by the Consultative Group to Assist the Poor (CGAP), a global partnership of more than 30 leading development organizations that works to advance the lives of the poor through financial inclusion, shows that microfinance institutions have been dealing with rising bad debts rising from a higher rate in of defaults in loan payments, as a result of the pandemic.
As a result of its resourcefulness in the face of the pandemic, LAPO MFB was named ‘Most supportive Microfinance bank’ by the Chartered Institute of Bankers (CIBN) in 2021.
LAPO maintains its reputation as a prolific award winner, consistently being recognized for its provision of sustainable financial services, as well as social and economic support, to members of low-income households and owners of micro small and medium enterprises.
This year alone, LAPO has won awards from credible organizations, such as the Microfinance Bank of the year at the Businessday Banks and other Financial Institutions (BAFI) Awards, five awards at the Development Bank of Nigeria (DBN) Awards, as well as that at the International Financial Inclusion Conference which is also significant because it was at the maiden edition of the conference.
The conference was a convergence of regulators, operators, policy analysts and government functionaries, and other critical stakeholders, aimed at examining opportunities, challenges and proffering solutions, regarding Nigeria’s financial inclusion objectives.
A press release issued by Cynthia Ikponmwosa, Managing Director, LAPO MfB, expressed the bank’s happiness and appreciation for winning the award.
“We appreciate the NIFS, organizers of this conference and the CBN for this recognition and award. it is a validation of LAPO’s immense impact on Financial inclusion through the consistent delivery of innovative Financial products and services to the last man in the last mile across Nigeria.”
With up to 535 branches in various locations across Nigeria, including the FCT, LAPO’s ubiquitous presence also promotes access to finance for millions of underbanked Nigerians. This and other keen strategies by its management team, make LAPO a leader in Nigeria’s drive for greater financial inclusion.
