The Managing Director of FairMoney Microfinance Bank, Henry Obiekea, has identified transparent digital lending as a critical factor in achieving Nigeria's ambitious target of becoming a $1 trillion economy. This revelation came through a policy brief released on November 20, 2025, highlighting the urgent need to address financial exclusion in the country.
Nigeria's Demographic Dividend and Financial Exclusion
Obiekea pointed to Nigeria's youthful population as a significant demographic advantage, with one of the lowest median ages globally. However, he revealed a startling statistic: approximately 36% of Nigerian adults, representing about 40 million people, remain either completely excluded from formal financial services or dependent on informal systems.
Breaking down these numbers further, he explained that 26% of adults have no access to banking services whatsoever, while another 10% rely exclusively on unregulated lenders. This situation creates significant barriers to economic participation and growth.
The Credit Gap Challenge
According to Obiekea, Nigeria faces a substantial credit penetration problem, with rates hovering between 13% and 19% of GDP, ranking among the lowest globally. This credit shortage severely limits growth opportunities for MSMEs and constrains household consumption.
The FairMoney boss contrasted Nigeria's position with other African nations, noting that Kenya and Egypt maintain credit-to-GDP ratios between 31% and 37%, roughly double Nigeria's performance. These countries have achieved better results through data-driven lending models that effectively reach small businesses.
Globally, emerging economies like India and Brazil demonstrate even deeper credit markets, with penetration rates between 53% and 62%. At the top end of the spectrum, South Africa boasts approximately 90% credit penetration, showcasing the distance Nigeria must travel to unlock its full economic potential.
The Digital Revolution as Solution
Obiekea emphasized that the solution lies in leveraging Nigeria's digital transformation. With mobile phone usage exceeding 93% among adults, the traditional barrier of physical bank branches has become increasingly irrelevant.
"Fintech companies in Nigeria have brilliantly seized this moment, leveraging mobile technology and data science to catalyze inclusion," he stated. However, he cautioned that digital access alone is insufficient without ensuring fairness and transparency in financial services.
The Finance Minister, Wale Edun, has reinforced this imperative, urging financial institutions to actively fund young Nigerians' ideas. The minister warned that failure to do so risks pushing talented individuals toward unregulated, unproductive ecosystems.
Obiekea concluded that for Nigeria to genuinely empower its population and grow the GDP, every financial transaction must strengthen, rather than undermine, the customer's financial wellbeing. This principle transforms financial services from a mere utility into a foundation of national economic strength.
