In Nigeria, a burgeoning financial challenge known as ‘mis-banking’ looms large over its burgeoning economy. Coined by Damola Giwa, the Managing Director for Digital Banking at ARM Group, at the Business Day C-Suite Executives Roundtable Dinner, it signifies the dissonance between the financial products banks offer and the actual needs of the customer base. In a landscape marked by an overwhelming reliance on cash transactions, traditional banking models and general assumptions fail to align with the cultural and economic realities of the nation. It is here that Giwa sees the potential for a technological epiphany, with artificial intelligence (AI) poised to bridge the gap.
Personalized Financial Solutions through AI
What makes AI an attractive solution to this systemic issue is its unparalleled ability to process vast amounts of data to extract meaningful insights about consumer behavior. Unlike traditional banking methods that deploy one-size-fits-all solutions with little consideration for individual circumstances, AI can tailor financial services to each customer’s unique profile. This approach not only enhances the user experience but also has the potential to drastically improve financial inclusion. Currently, a paltry 6% of Nigerian adults can access credit from licensed financial institutions. The use of AI in deciphering the complex web of each customer’s financial needs can democratize access to credit and other banking services, which are crucial for personal and economic growth.
Embracing Customer-Centric Innovation
Nigeria’s economy is facing a unique challenge, often referred to as ‘mis-banking,’ a term introduced by Damola Giwa, the Managing Director for Digital Banking at ARM Group, during the Business Day C-Suite Executives Roundtable Dinner. This issue highlights a growing disconnect between the banking services provided and the actual financial requirements of Nigerian customers. Given the country’s heavy dependence on cash and the inadequacy of traditional banking practices to meet local needs, there is a clear misalignment with Nigeria’s cultural and economic practices. Giwa suggests that this problem presents an opportunity for innovation, wherein artificial intelligence (AI) could serve as a transformative tool reconciling the needs of consumers with the offerings of banks. This technological leap could be the key to revolutionizing banking in a manner that respects the unique context of Nigeria’s market.
