By Elvis Eromosele

The Federal Ministry of Communication has a new name. It will henceforth be known, called and referred to as the Federal Ministry of Communication and Digital Economy.

When the news broke last week that the Federal Executive Council (FEC) had approved the name change, there was plenty of cheers and jeers.

In itself, there is nothing wrong with a name change. Infact, this change takes cognizance of emerging global trend. It shows awareness of the growing significance of the place of digital technologies in modern societies. It also seeks to take advantage of the development. At face value, this name change definitely looks like a good thing.

This makes sense especially when one considers that the world, itself, is changing. This change is driven largely by the wide spread deployment of digital technology infrastructure which is in fact, a huge contribution in changing how humans live, work and plan.

Experts in different parts of the world insist that the wide spread deployment of digital technology is hugely transforming industries and spurring unprecedented socio-economic development. New and emerging technologies enable and precipitate unimaginable innovations at near breakneck pace.

These days, it is obvious that innovations arrive every day to make life easier.

For example, digital technology makes it so much easier and faster to transact businesses across borders. Digital technology continues to break borders and reshape boundaries. Today, it is creating a connected society that is the basis of the emerging digital economy.

The digital economy is the economic activity that results from everyday online connections among people, businesses, devices, data, and processes. It is said that, “The backbone of the digital economy is hyper-connectivity which means growing interconnectedness of people, organisations, and machines that results from the Internet, mobile technology and the internet of things (IoT).”

According to a report by the World Economic Forum, “By 2022, over 60 percent of global GDP will be digitised. Indeed, an estimated 70 percent of new value created in the economy over the next decade will be based on digitally enabled platforms.”It is clear therefore that digital economy is already upon us.

Thankfully, Nigeria is abreast of the trends. Experts say it is as a result of the dedication to massive investment in digital communication infrastructure by the telecommunications companies. In close to two decades, conservative estimates put the figure at over $40 billion. A direct manifestation of this investment is the number of mobile subscribers currently at over 172 million according to figures from the Nigerian Communications Commission (NCC).

Despite this growth, a lot more still needs to be done. Take internet penetration which stands at about 50 percent. A massive 50 percent of the population are still out of the internet loop. Internet access must become ubiquitous to get more people into the digital economy. This is the only way people can possibly partake and benefit.

Consider, Electronic Commerce (e-commerce). It is has taken off with a blast in the country. it is now an area of global investor confidence in Nigeria. The Euromonitor International Market Research reveals that e-commerce advancements have been most notable in Nigeria because of the surge in telecom investments and smartphone purchases which have fueled growth in internet usage.

In addition, the Central Bank of Nigeria’s (CBN) cashless policy initiative also helped to drive uptake as it is precipitating new and exciting payment options. These are the building blocks of the digital economy – digital infrastructure, internet connection and effective e-commerce along e-payment systems.

The above is precisely why talks of taxing e-commerce transactions by the Federal Inland Revenue Service (FIRS) is abhorrent. This will thwart the efforts to encourage the growth of digital economy in Nigeria. The Ministry of Communication and the Digital Economy must quickly address the issue and nip it in the bud.

The Nigerian government is big on ease of doing business.The latest report justifies the commitment and effort the government is making. Progress is been made. More still needs to be done however. Undoubtedly, the proposed e-commerce tax negates this well thought out policy drive and should be jettisoned.

Unarguably, in today’s world, access to broadband should be a human right. It should be given priority by the government in order to improve access across the country and be completely affordable. To encourage interest in the sector, the government must actively consider subsiding investment in the digital space. It should consider tax breaks and other incentives.

Evidently, the emergence and nurturing of activities in the digital economy are key for diversification of the economy. So, in order to demonstrate its seriousness in this regard, the government must support efforts, particularly by the private sector, to grow the digital economy. Perennial issues around right-of-way approval, multiple taxation and the designation of telecom infrastructure as critical national infrastructure worthy of special protection must be pursued until actualised.

Dr. Isa Pantami, the Minister in charge of the renamed ministry, was absolutely right when he insinuated that “The name change will properly position and empower the ministry to fulfill its digital economy objectives. It will further expand the ministry’s mandate to capture the goals of digitalisation of the Nigerian economy in line with the Economic Growth and Recovery Plan (EGRP), one of the key agenda of the present administration.”

However, beyond the name change, the ministry must demonstrate greater understanding of the issues, show stronger support for players in the sector and must be seen to encourage policies that promotes the growth of the sector.

In a year’s time, Nigerians must be able to look back and say the name change was worth it. The citizens should be able to celebrate real net impacts beyond the nomenclature!

This is how to grow the digital economy!

Elvis Eromosele, a Corporate Communication professional and public affairs analyst lives in Lagos.

Following the registration of a N30 billion debt issuance programme with the Securities and Exchange Commission of Nigeria (SEC), Interswitch Limited, a leading technology-driven company focused on the digitisation of payments in Nigeria and other African countries, has successfully concluded a N23 billion Series 1 Fixed Rate Senior Unsecured Callable Bonds via a Special Purpose Vehicle (SPV), Interswitch Africa One PLC.

The Series 1 Issue priced at 15% was 2.6x subscribed. The 7-year Bonds, embedding a call option that can only be exercised from the second year, are payable in full at maturity. An application will be made to list the Bonds on The Nigerian Stock Exchange (NSE) on receipt of the SEC’s approval of the proposed allotments.

Investor participation was restricted to qualified institutional investors as defined by the SEC in Nigeria, with a proposed Bonds allocation of 64% to pension fund managers, 7% to asset managers and 22% to commercial banks pending SEC approval.

The strong level of over subscription demonstrated investor confidence in the Interswitch brand, business model and long-term strategy, supported by strong domestic ratings from both Agusto& Co. Limited and Moody’s Investor Service.

The Issuer was assigned “Aa3” national scale programme rating (stable) by Moody’s and “Aa” (stable) national scale rating by Agusto, on the back of positive secular industry shifts, a strong market position and a good liquidity profile. The Sponsor was also assigned “Aa” (stable) rating by Agusto.

The Founder and CEO, Mr. Mitchell Elegbe, commented: “We are delighted to report the success of the first series of Bonds issued under our Programme, especially with the level of interest shown by investors. Diversifying our funding sources through the inclusion of these Bonds will enable us achieve our strategic objectives and vision.”

FBNQuest Merchant Bank and Stanbic IBTC Capital acted as Lead Financial Advisors/Issuing Houses and ABSA Capital Markets Nigeria, FCMB Capital Markets, Quantum Zenith Capital & Investments and Rand Merchant Bank Nigeria, as Joint Issuing Houses.

About Interswitch

Interswitch is a leading technology-driven company focused on the digitisation of payments in Nigeria and other countries in Africa. Founded in 2002, Interswitch disrupted the traditional cash-based payments value chain in Nigeria by helping to introduce electronic payments processing and switching services.

Today, Interswitch is a leading player with critical mass in Nigeria’s developing financial ecosystem and is active across the payments value chain, providing a full suite of omni-channel payment solutions.

Interswitch’s vision is to make payments a seamless part of everyday life in Africa, and its mission is to create transaction solutions that enable individuals and communities to prosper across Africa.

Interswitch’s broad network and robust payments platform have been instrumental to the development of the Nigerian payments ecosystem and provide Interswitch with credibility to expand across Africa.

MTN Nigeria Communications Plc says it puts consumers first in the implementation of the USSD access charges regime in line with the objectives of the National Financial Inclusion Plan. The statement by MTN read as follows:

We at MTN approach every day with one primary objective – finding ways to make our customers lives a little easier; which is why we will focus on what really matters, our customers. 

They are the reason we made transparency and simplicity central to the recent drawn-out engagements with the banks over USSD access charges and how they should be applied. 

Following consultation with industry stakeholders, customer feedback and media reports related to the message notifying our customers of upcoming changes in our charging model for access to banking services via the USSD channel, we wish to confirm that the new charging model has not gone into effect.

The situation has made it necessary to restate that MTN Nigeria, in line with our company policy will always be transparent in our dealings with customers, the industry and relevant regulatory bodies.

The SMS notification to our customers is reflective of this commitment and was sent after formal requests received from individual banks as well as the Body of Bank CEOs to implement end-user billing – a billing methodology where the customer is directly charged USSD access fees irrespective of the service charges that the bank may subsequently apply to their bank account.

It should be noted that the banks had up-till now been on a corporate billing plan – where a corporate client, the provider of the service that is accessed through the USSD channel (in this case the bank), pays the access fees at a wholesale price.

We believe the costs associated with USSD banking services should be charged to the consumer only once – as with other USSD-based services we provide, which we believe has been adequately provisioned for within existing Central Bank of Nigeria (CBN) guidelines. 

It is infact in line with the National Financial Inclusion Strategy of the Federal Government that we resisted the calls for end-user billing. We relented only after exhausting avenues of engagement with the banks in pursuit of a model that enabled a single charge.

We believe separate charges by the banks and telecoms companies are an unnecessary burden on the consumer, especially the target group that the National Financial Inclusion Strategy is aimed at. 

With this in mind, it is imperative for all parties to approach the table and engage constructively towards a solution, putting the consumer at the fore of all decisions. 

The banks have been and still are our esteemed customers and valued partners. We look forward to collaborating with them and other stakeholders and will be glad to implement the decisions approved by our Regulators.

Uto Ukpanah

Company Secretary

Mr. Eddie Efekoha, President & Chairman of Council, Chartered Insurance Institute of Nigeria (CIIN) says the emerging digital era will define the insurance industry of today and the future.

Speaking at the 2019 Insurance Professionals’ Forum at Abeokuta, Ogun State on the theme: The Digital Era: Implications for insurance Professionals, Efekoha said: “The Digital era is here and Artificial Intelligence is playing a major role in its evolution.  More organisations are embracing the idea of a single microchip processing multiple functions. Indeed, the future which Artificial Intelligence promises for insurance is a series of touch-less processes from premium collection through to the entire claims process. Big data is all around us, ready to be harnessed and put to use. As an industry, how are we leveraging on technology to simplify data analytics in order to:

• Make pricing of insurable risks more accurate
• Enhance self-servicing of customers through interactive websites
• Tweak sales practices in line with customer needs and wants in order to improve profitability
• Cost efficiency
• Maximize overall performance

Importantly, Artificial Intelligence has never been less expensive or inaccessible. The question that arises however is: what is the role of the modern day insurance professional as this evolution plays out and what will be his when this evolution attains its full cycle? How will he/she stay relevant in an artificial intelligence driven society?”

He warned that any insurance professional who wants to remain relevant must see the opportunities in the threats posed by this digital era. He added that as someone who has been part and parcel of the Commission and insurance industry for years, it is a shame that Africa’s biggest economy (Nigeria) has an insurance penetration rate of about 0.3%.

Efekoha insisted that while the on-going recapitalisation in the insurance industry is important, of equal importance is the need for market development.

“As we embrace digital, we should not overlook the dangers posed by cybercrime around us. Cybercrime isn’t a myth, it is real. The National Information Technology Development Agency (NITDA) stated that in 2017, Nigeria lost $500million dollars to cyber-attacks, a figure up by $50 million from the year before. Globally, these numbers are even bigger and it is projected that damage related to cyber-crime will hit $6trillion annually by 2021. This Trojan horse is a big threat to professionals. As managers of businesses, we must keep abreast of the dangers its poses to businesses. Except we control this threat, we may have no relevance in the nearest future; that is if we still have businesses to run.”

The CIIN president said the relevance of the younger generation in this era of artificial intelligence has been brought to the fore by the Institute.

“Making its debut in this Forum is a conversation strictly for the next generation. They will be talking about the expectations and roles of the youth as leaders of tomorrow in the insurance industry.”

In pursuit of its goal to contribute to bridging the financial divide, MTN Group has granted third parties access to its Mobile Money (MoMo) Access Programming Interface (API) platform.

The open API enables developers and programmers to innovate on the platform and develop products and other solutions that will create a wider range of digital financial offerings for MTN’s customers.

To further foster innovation and enhance financial inclusion, MTN is inviting developers and entrepreneurs, across five countries, to participate in the MoMo API Hackathon.

The Hackathon, run in partnership with Ericsson (MTN’s MoMo technology partner), will give app developers based in Ghana, Uganda, Cote d’Ivoire, Cameroon and Zambia the opportunity to create innovative financial and transactional applications using the MTN MoMo API platform.

“Enhancing financial inclusion through digital technology is an essential element in supporting the continent’s realisation of some of the United Nation’s Sustainable Development Goals. We also see this as an opportunity for more tech developers, entrepreneurs and businesses to work with us in bridging the financial divide, whilst also creating ample opportunities for themselves,” said Serigne Dioum, MTN Group Executive for Mobile Financial Services.

This Hackathon further illustrates the essence of the company’s ‘We’re Good Together’ initiative, which celebrates the role that collaboration can play in ensuring that more people enjoy the benefits of a modern connected life. The range of solutions to narrow the financial services gap can only be achieved through various partnerships with entrepreneurs, developers, financial services providers, regulatory authorities, other mobile network operators, merchants, distributors, businesses and technology providers.

About the challenge

• Developers are required to create a mobile application that uses MTN MoMo APIs, the mobile application needs to target consumers, merchants or businesses.
• The application must be useful and usable in the market where the applicants have registered and can cover use cases beyond payment but must utilise MTN MoMo APIs.
• MTN/Ericsson in each country will select 12 applicants.
• The preselected applicants will have 2 weeks to develop their ideas.
• The preselected applicants will need to make a live demo of their application submission.

Finalists stand the chance to win up to USD2, 500 and one team member will win a trip to Ericsson’s Innovation Lab in Sweden.