You've just had a wonderful idea for a startup company. It's been spinning around in your head for months now, and you just know that you have something special on your hands. Your thinking is, "If only I could make it work" or "If only someone would give me the money to get it off the ground!"

Well, guess what? No one's going to hand you a sack of cash. But the good news is that you don't need anyone's money if you can't find anyone to help fund your business idea. Here are the steps you need to take to put your business idea into action:

1. Validate your idea

The best way to validate your business idea is by asking people for their thoughts on it. Don't ask for money or investment. Ask them for specific feedback about certain aspects of your business. For example, if you're opening a new restaurant, ask them what kind of food they like eating at restaurants and what restaurants they like going to most often.

You'll get better results if you focus on one specific part of your business at a time rather than asking them if they'd use your entire product or service — it allows them to give more in-depth answers without feeling overwhelmed by everything else in your pitch!

2. Write a business plan and business model

Writing down your ideas and plans not only helps you clarify what you want to do, but it also allows you to make sure there are no holes in your plan. Here's what you should include:

• A description of your business, including its mission statement and goals
• A description of the target market for your product or service
• A description of the competition in your industry
• A description of how customers will find out about your product or service
• How much funding is needed for startup costs and ongoing expenses

3. Talk to your potential customers

In order to put your business idea into action, you have to talk to your potential customers. That's right — it all starts with a conversation.

When creating a new product or service, you can't assume that your customers' needs will align with yours, because they might not. You need to speak directly to potential customers and ask them what they want and how much they'd be willing to pay for it.

4. Develop a prototype

If you have a great idea for a product or service but want to know if people will buy it before you invest time and money into making it, you need to create a prototype. A prototype is a working model of your idea that allows you to see if it works, what needs to be reworked and how you might improve it. This can take many forms — from an Excel sheet or Google Sheets document with all the features you want in your product to a fully-functional website that mimics the final product.

5. Test it out and prove the concept

It's time to test.

Test your business idea in a small way. For instance, if you want to be a freelance writer, write up a few sample articles and offer them free to some clients. If you plan on starting a food truck business, make one or two dishes and sell them at one or two events (or even in your kitchen). You can also use tools like Google Analytics or SurveyMonkey to see which ideas are most popular with customers before you launch your business.

6. Understanding the legal implications and registering your business

A big part of creating a business is selecting one available business structure. In the United States, no single government agency is responsible for registering new businesses. Instead, many different types of entities can be formed for small businesses, including corporations, limited liability companies (LLCs), partnerships and sole proprietorships. Each type of entity has its pros and cons and is suited to different types of companies. Once you have determined which type of entity is right for your business, you will be able to register it with the appropriate state or federal agency.

7. Financing and investors

While not all startups fail, those that do usually make one of two mistakes. First, they run out of money before they have developed a market for their product or service; second, they fail to persuade investors to give them money in exchange for equity. The best way to avoid these mistakes is to demonstrate that people will want your product or service enough to pay for it.

8. Build market awareness

Before starting your business idea, building awareness and credibility with potential customers is essential. Start by creating a website, social media profiles and a mailing list. Reach out to people who can help you get feedback on your idea; find out what business would best suit your skillset and where there is enough demand for it in your area. There are plenty of ways to get started without spending lots of money on marketing materials or advertising campaigns; just go through Neil Patel Blogs to start.

9. Hire employees

After you have completed the above steps to start a business, it's time to begin hiring employees. You should hire people for customer service, sales, marketing and accounting roles. I have found that the best way to hire employees, in the beginning, is by word of mouth. If someone has had a positive experience working with you, they will tell others about their experience and recommend that they apply for a job at your company.

If you have a brilliant business idea, you should work hard to put it into action — but here's one last tip: Before you start up your own business, make sure to research what the competition is all about. Is there anything already in place? Is there a product or service similar to yours? If so, look into the advertising and marketing strategies, and study the areas they've succeeded and failed. Don't steal their ideas, but rather be inspired by them, coming up with an idea of what works for you since every business is unique.

Entrepreneur

Tax payments from local companies in Nigeria saw a massive 249.2 percent jump in the second quarter (Q2) of 2024, according to the latest company income tax (CIT) report by the National Bureau of Statistics (NBS).

The CIT, also known as corporate tax, is levied on the profits made by companies operating in Nigeria. It is regulated by the Companies Income Tax Act (CITA) and enforced by the Federal Inland Revenue Service (FIRS).

Currently, the tax is charged at 30 percent for companies with more than N100 million in turnover, and 20 percent for companies with a turnover ranging between N25 million and N100 million.

NBS said local companies contributed N1.35 trillion in taxes to the federal government in Q2, compared to N386.49 billion in the previous quarter.

While foreign firms operating in Nigeria contributed N1.12 trillion in Q2 — an increase of 87.2 percent compared to the N598.13 billion reported in Q1.

BREAKDOWN OF PERFORMANCE BY SECTOR

The NBS report showed that the agricultural sector contributed the highest company income tax in Q2, showing a remarkable 474.50 percent increase from the previous quarter.

“On a quarter-on-quarter basis, agriculture, forestry, and fishing recorded the highest growth rate with 474.50%, followed by financial and insurance activities and manufacturing with 429.76% and 414.15%, respectively,” the report said.

Several sectors experienced a decline in company income tax payments during the quarter under review.

“On the other hand, activities of households as employers, undifferentiated goods- and services-producing activities of households for own use, had the lowest growth rate with -30.22%, followed by activities of extraterritorial organizations and bodies with -15.67%,” NBS said.

N20.68 TRILLION IN CORPORATE TAXES FROM 2015 TO 2024

Analysis by TheCable Index showed that Nigeria’s corporate tax revenue has experienced remarkable growth over the past decade.

From 2015 to 2024, the country amassed a total of N20.68 trillion in corporate taxes.

In 2015, the federal government collected N1.38 trillion in corporate taxes, however, in 2016, the revenue decreased to N1.02 trillion.

The decline halted in 2017, as the CIT collected by the government climbed to N1.24 trillion.

The upward trend continued, with N1.42 trillion CIT collected in 2018 and N1.63 trillion in 2019.

However, it declined to N1.41 trillion in 2020 but increased to N1.69 trillion in 2021.

The growth continued in 2022, with collection reaching N2.83 trillion, climbing further to N4.89 trillion in 2023.

For the first half of 2024, the total company income tax collected stood at N3.45 trillion.

LOCAL FIRMS LEAD CIT PAYMENTS

Further analysis showed that over the past decade — excluding 2015 — local companies have paid more CIT than foreign firms operating in Nigeria.

In 2015, local companies paid N645.68 billion in corporate tax, while foreign firms contributed N715.52 billion.

However, in 2016, local payments surpassed that of foreign firms, as the former paid N620.78 billion, while CIT from the latter was N360.23 billion.

This trend continued in 2017, with local companies paying CIT of N666.79 billion, compared to the N489.90 billion paid by foreign firms.

In 2018, CIT from local and foreign firms amounted to N709.94 billion and N534.96 billion, respectively.

The amount increased in 2019, as the government collected N813.17 billion from local firms and N615.52 billion from foreign firms.

By 2020, payments from both local and foreign firms decreased to N628.58 billion and N317.25 billion, respectively.

However, in 2021, company income tax collected from local firms crossed the N1 trillion mark, reaching N1.10 trillion, while foreign firms paid N527.62 billion.

In 2022, local and foreign firms CIT rose to N1.68 trillion and N1.15 trillion, respectively.

By 2023, both local and foreign firms’ CIT had surpassed N2 trillion, with local firms paying company income tax of N2.51 trillion and foreign firms parting with N2.39 trillion.

Although 2024 data only covers the first half of the year, the current payments of N1.74 trillion for local firms and N1.72 trillion for foreign firms indicate an upward trend for the remainder of the year.

The Cable

Severe flooding has ravaged Borno State in northeastern Nigeria, leaving a trail of devastation in its wake. The disaster, which has affected nearly one million residents, follows the collapse of the Alau Dam, causing widespread destruction across Maiduguri, the state capital. At least 30 people have been confirmed dead, with fears that the casualty figure could be much higher, as many, including children, remain missing.

The flooding, triggered by heavy rains and the overflow of the Alau Dam, swept through communities, submerging homes, farmlands, and critical infrastructure. Key locations affected include the Monday Market, Gwange, Shehuri, and the Shehu of Borno’s Palace. In a particularly grim development, the Gwange cemetery was destroyed, with coffins and corpses seen floating in the streets.

Governor Babagana Zulum, who visited the Bakassi Camp to distribute aid to displaced persons, reported that one-quarter of Maiduguri is underwater, with the health sector in critical condition. He expressed concerns about the spread of waterborne diseases due to the flooding of sewage systems and noted that a health emergency committee has been set up to mitigate potential outbreaks. The University of Maiduguri Teaching Hospital (UMTH) was also affected, with patients left stranded.

As the death toll climbs, the National Emergency Management Agency (NEMA) has been actively involved in rescue efforts. The agency confirmed that 719 people had been rescued from rooftops, trees, and floodwaters. Additional search and rescue personnel have been deployed, and clean drinking water is being provided to displaced residents to prevent the spread of waterborne diseases.

In response to the crisis, the federal government has provided a N3 billion relief fund to assist victims and address the challenges brought by the flood. Governor Zulum has also called for the reconstruction and upgrade of the Alau Dam to prevent future disasters and pledged to demolish illegal structures blocking waterways.

Meanwhile, the flooding has caused severe disruptions to the local economy. Major markets in Maiduguri, including grain, fruit, and vegetable depots, have been submerged, leading to a sharp rise in food prices as supplies dwindle. Residents are struggling to access food and essential commodities, with many business premises closed due to the destruction.

Rescue operations are ongoing, but the full extent of the damage is yet to be determined. As waters begin to recede, displaced residents return to find their homes destroyed and their livelihoods in ruins.

Zulum assured citizens that reconstruction efforts would begin soon, and measures would be taken to prevent a recurrence of such a catastrophe.

Despite the immense challenges, community efforts are emerging, with volunteers like Fatima Satomi providing meals for displaced residents. However, with thousands still stranded and in need of urgent assistance, the state faces an uphill battle to recover from one of the worst floods in its history.

With additional reports from Reuters & Daily Trust

In response to Nigeria's ongoing fuel pricing and supply challenges, the International Monetary Fund (IMF) has called on the Federal Government to prioritize the protection of vulnerable citizens from the impact of rising petrol prices. Speaking in an interview with Arise TV, Christian Ebeke, IMF's Resident Representative in Nigeria, emphasized the importance of accelerating social safety programs to support those hardest hit by economic policies, particularly amid the current inflation and multiple economic shocks.

Ebeke noted that petrol prices in Nigeria remain below market rates, suggesting a potential further increase. This comes on the heels of a similar statement from the Nigerian National Petroleum Company Limited (NNPCL). He expressed concern about the hardships Nigerians are enduring due to a combination of high inflation, food shortages, and the recent floods, all of which are straining the nation's economy.

"The upward adjustment in petrol prices is occurring at a time when Nigerians are already grappling with significant difficulties," Ebeke stated. "The government’s support program, which aims to reach 15 million households, is crucial. However, it needs to be accelerated to cushion the effects of rising fuel prices on the most vulnerable."

Current Fuel Prices and Supply Issues

Ebeke also echoed concerns raised by NNPCL regarding the current non-market-reflective petrol prices, which have contributed to supply shortages and fuel station queues across the country. He stressed the importance of ensuring stability in supply while adjusting fuel prices, but reiterated that the immediate focus should be on mitigating the impact on the poor.

"If these price adjustments stabilize the fuel market, it would benefit many Nigerians, as the ongoing fuel scarcity is hindering the country’s productivity," he added.

Competition and Supply from Dangote Refinery

Addressing the controversy over the distribution of products from the Dangote Refinery, Ebeke highlighted the need for competition in the oil market. He explained that competition ensures better product quality and supply stability, which ultimately benefits consumers.

"Ensuring availability of supply and fostering competition will create a stable market and allow consumers to get the best deals," Ebeke said, advocating for policies that prioritize these principles.

Balancing Economic Reforms with Social Protection

In response to the Federal Government’s stance that its economic reforms are necessary for long-term growth, Ebeke stressed the importance of balancing policy measures. He noted that while reforms like fuel price adjustments are critical for economic stability, they must be implemented alongside social protection programs to ease the burden on the poor.

"When implementing challenging reforms, you must pair them with measures that protect the most vulnerable. It’s not just about price adjustments, but also about ensuring that people have the support they need to cope with these changes," he emphasized.

Outlook for Nigeria’s Economy in 2024

Looking ahead to Nigeria’s economic future, Ebeke acknowledged the government's ambitious plans to transform the economy, stabilize markets, and reduce poverty. However, he stressed that these efforts must be supported by adequate revenue generation, as Nigeria continues to face one of the lowest revenue-to-GDP ratios in the world.

"The government’s ability to raise revenue is crucial for financing infrastructure, healthcare, and education. These are the key areas where growth and development must be promoted," Ebeke noted.

Moniepoint, a financial technology firm (fintech), says 58.9 percent of women-owned businesses in Nigeria struggle to access funding.

Moniepoint, in a report focusing on funding for women-owned businesses in Nigeria, said 40.2 percent of women use their funds and savings to run or start their businesses.

The fintech said while 16.7 percent of women manage to get access to loans from their financial institutions, 83.3 percent are left to rely on family, friends, and personal funds to start or keep their businesses running.

“For many women-owned businesses, sources of funding are few. With a financing gap of 32%, women are either less likely to receive funding, or they receive smaller amounts when they do,” the report reads.

“Our data paints a similar picture, as 40.2% of women use their personal funds and savings to run or start their businesses.

“A closer look at the source of their “external funding”, shows that a greater number of them access this from family and friends, either as loans or cash gifts.

“Only 16.7% of these women are able to get access to the loans their businesses need via financial institutions.”

Moniepoint said although access to funding can positively impact a business’s lifespan, women-owned startups find it relatively harder to get funding compared to “older businesses”.

“Barring a few exceptions, such as family businesses or trust funds, it’s difficult to scale businesses with funds from personal savings or family and friends,” the report said.

“Formal investment sets businesses up for faster growth and expansion. Sadly, not having the right documentation and collateral makes it difficult for small businesses to scale.

“However, the funding gap between women and men-owned businesses persists regardless of size, education level, industry and financial status.”

The report also said businesses that have access to external funding (crowdfunding, government grants, loans from financial institutions, loans from cooperatives, borrowed from families and gifts from friends) are more likely to expand and have multiple stores than those who use personal funds.

Giving reasons for the funding gap, the fintech’s report highlighted issues such as unconscious bias, societal constraints and financial habits, and lack of awareness as major funding challenges women-owned businesses face.

Moniepoint said avoiding bias or discrimination is the first step to bridging the gap.

The report also said providing women with tools to accept payments digitally and quick access to credit facilities without overleveraging them would help in sustaining their businesses.

The Cable

An American businessman, Marco Antonio Ramirez, has been sentenced to 68 years in prison by a Lagos court for defrauding Nigerians of $1.6 million in a fraudulent visa investment scheme.

The ruling was delivered on Tuesday, September 10, 2024, by Mojisola Dada of the Special Offences Court sitting in Ikeja as disclosed by EFCC.

Dada, in her verdict, emphasized the gravity of the offenses, stating, “The prosecution has proven its case beyond a reasonable doubt. Marco Antonio Ramirez’s fraudulent actions have inflicted significant financial harm on his victims.”

She elaborated on the sentencing, noting, “The court has imposed a total sentence of 68 years to reflect the severity of the crimes committed and to serve as a deterrent to others.”

Details of the case 

Ramirez was convicted on a 16-count charge brought against him by the Economic and Financial Crimes Commission (EFCC), including charges of obtaining money by false pretence and stealing.

According to the EFCC, Ramirez and his companies, USA NOW LLC, Eagle Ford Instalodge Group LP, and USA Now Energy Capital Group LP, scammed his victims by promising to process their investments through the United States EB-5 Investor Programme, which was purported to help them obtain green cards.

The EFCC prosecutor, M.S. Owede, expressed satisfaction with the court’s decision, stating, “Today’s judgment is a testament to the EFCC’s relentless pursuit of justice for victims of financial crimes. We are pleased that the court has held Marco Antonio Ramirez accountable for his fraudulent activities.”

Victims 

The court heard how Ramirez dishonourably converted large sums, including $545,000 from Godson Onyemaechi Echegile and $314,800 from Abubakar Umar Sadiq, for personal use under the guise of investment. These funds were meant to be investments in his company, but Ramirez failed to deliver on his promises, leaving his victims without the promised visas or their money.

In addition to the charges related to the EB-5 programme, Ramirez was found guilty of defrauding Gabriel Ogie Edeoghon of $250,000 and Oludare Talabi of $50,281.33 in separate visa scams.

Prosecuting counsel S.O. Daji commented, “The court’s decision today reaffirms our commitment to fighting fraud and ensuring that those who exploit others for personal gain face justice.”

Ramirez’s legal battles spanned several years, with repeated delays due to the absence of his defence counsel, Lawal Pedro. However, on May 8, 2024, the court adopted the final written addresses, setting the stage for the judgment.

Nairametrics

Hamas says ready to implement ceasefire without new conditions

The Palestinian Hamas group said on Wednesday that its negotiators reiterated its readiness to implement an "immediate" ceasefire with Israel in Gaza based on a previous U.S. proposal without new conditions from any party.

The Palestinian group said in a statement that their negotiation team, led by senior official Khalil al-Hayya, met mediators on Wednesday including Qatar's Prime Minister Sheikh Mohammed bin Abdulrahman Al Thani and Egypt's intelligence chief Abbas Kamel in Doha to discuss the latest developments in Gaza.

Talks have so far failed to reach a deal to end the 11-month-old war. Lingering issue include control of the Philadelphi corridor, a narrow stretch of land on Gaza's border with Egypt, persisting.

CIA Director William Burns, who is also the chief U.S. negotiator on Gaza, said on Saturday that a more detailed ceasefire proposal would be made in the next several days.

The previous proposal put forward by U.S. President Joe Biden in June laid out a three-phase ceasefire in return for the release of Israeli hostages.

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The recent war in Gaza started after Hamas militants attacked Israel on Oct. 7 killing 1,200 people and taking about 250 hostages, according to Israeli tallies. Israel's offensive has thus far killed at least 41,084 Palestinians and wounded 95,029 others, the Gaza health ministry says.

Reuters

RUSSIAN PERSPECTIVE

Russian troops reportedly pushing Ukrainians back in Kursk

Russian forces appear to be pushing Ukrainian troops back in a Kiev-controlled area of Russia’s Kursk Region, footage circulating online purports to show. The Russian Defense Ministry has not confirmed that the counteroffensive has begun.

A pro-Russian Telegram channel released on Wednesday clips that it claims show the achievements of the 51st Guard Regiment of the Russian Airborne Troops near the settlement of Snagost.

Kiev deployed thousands of heavily armed troops for its operation on Russian soil. According to the Russian military, Ukrainian casualties have surpassed 10,000 during the month-long incursion.

The longest video was filmed from a drone and shows what appears to be a battle in a rural area involving multiple armored vehicles.

Another one purports to show a group of Ukrainian POWs walking down a road. Some of them are holding their hands behind their heads while others prop up an injured comrade. 

Snagost has been mentioned by the Russian Defense Ministry as a location where fighting against the invading Ukrainian troops has been taking place on a regular basis. It is located roughly 7km southeast of the Seim River, a notable landmark that helps identify the location in the video.

Ukrainian troops targeted bridges over the Seim further to the west, apparently to make the territory under their control easier to defend from Russian ground attacks.

WESTERN PERSPECTIVE

Three killed, five injured in Russian attacks on east Ukrainian town

Three women were killed and five other people were injured on Wednesday during Russian attacks on the eastern Ukrainian town of Kostiantynivka in the Donetsk region, prosecutors said.

Russian troops shelled a residential part of the town, some 14 km (nine miles) from the active combat zone, and killed two elderly women, the Prosecutor's General Office said on the Telegram messaging app.

Later Russian forces hit another residential area, probably with a self-propelled multiple rocket launcher, killing a middle-aged woman and injuring five other civilians, it said.

The Donetsk region, which Russian troops partially occupy, regularly comes under Russian shelling and airstrikes.

Moscow denies targeting civilians or civilian infrastructure in its invasion of Ukraine, although thousands of people have been killed in its attacks.

RT/Reuters

Young people have been leading large-scale protests in two of Africa’s most influential countries, Kenya and Nigeria. While many of the protesters’ demands are unlikely to be met, the demonstrations highlight the urgent need for fundamental reforms, not only in Kenya and Nigeria, but across Africa.

In Kenya, young people first took to the streets in June to execute “seven days of rage” – massive and largely peaceful protests against a proposed finance bill that would increase taxes on a wide range of goods and services at a time when the cost of living is surging. Thousands stormed Kenya’s parliament, and President William Ruto deployed the military to carry out a violent crackdown that, in the ensuing weeks, left at least 39 dead and nearly 400 wounded. More than 600 protesters have been detained.

Despite initially vowing to quash the protests, Ruto soon conceded that the people had spoken, withdrew the bill, and dissolved his cabinet. Yet the protests – including calls for Ruto’s resignation – continued, with young people demanding action to address deep-seated problems like government corruption, mismanagement of public funds, and inadequate checks on the executive’s authority.

The Kenya protests inspired young Nigerians, who announced ten days of anti-government protests during August. Their grievances, too, are largely related to the economy and poor governance. Fuel costs rose exponentiallyafter President Bola Tinubu scrapped a longstanding subsidy last year. And the naira’s value plummeted following the central bank’s decision to allow market forces alone to determine the exchange rate.

Now, ordinary Nigerians – who already face high unemployment – are being crushed by inflation and food and power shortages. Yet, as in Kenya, their attempts to be heard have been met with state violence – more than 20 are dead, and hundreds more have been arrested – even as political leaders have paid lip service to their demands.

The problems driving recent protests are hardly confined to Nigeria and Kenya. High unemployment is taking a toll on educated urban youth in many parts of Africa. Moreover, many leaders across the continent implement economic reforms that disproportionately burden ordinary citizens, while elected officials continue to enjoy extravagant lifestyles. Many African countries have records of human-rights violations, which go unpunished. Achieving a more stable, prosperous future in Africa requires action in all these areas.

Begin with the prevailing approach to economic reform. Both Ruto and Tinubu would argue that their controversial policy proposals were in their countries’ interest. Ruto’s finance bill was designed to reduce the budget deficit, rein in public debt, and satisfy lenders like the International Monetary Fund (which halted funding to Kenya after the bill was withdrawn). Similarly, Tinubu’s decision to end fuel subsidies aimed to ease pressure on public finances, while the change to the exchange-rate regime was supposed to stabilize the economy and attract investment.

But implementing austerity measures without considering people’s ability to weather them shows a lack of empathy – even disdain. If the terms of a loan agreement are too onerous, it is the government’s job to renegotiate them. Technocrats and responsible politicians must signal to the IMF that demanding reforms that will take an excessive toll on ordinary people leaves countries vulnerable to unrest, while undermining the Fund’s legitimacy – and that of other international institutions – as a partner of African countries.

In any case, if African governments are serious about reducing deficits and debt, they should first look inward. Elected officials in Kenya and Nigeria are not only among the world’s highest-paid; they also benefit significantly from “constituency development funds” – essentially slush funds for politicians. Kenya’s government is particularly bloated.

Curtailing such expenditure is urgent and would be a strong good-faith gesture to young people. A radical increase in transparency – showing how public money is spent at the national and sub-national levels and enabling easier tracking of these expenditures by citizen groups – would also help. Public commitments, such as through the Open Government Partnership, are a good first step, but only if they are quickly backed by action. All of these efforts are prerequisites to reducing corruption.

A third piece of the reform puzzle is ending impunity for state violence. The recent crackdowns are, after all, nothing new in Africa. In Nigeria, the 2020 protests against police brutality were met with yet more violence by security agents, who have faced no accountability whatsoever. Last year’s cost-of-living protests in Kenya were also met with violence, for which no one has been held accountable. Similar stories can be told about many other African countries, where repression is often widespread.

Ending such impunity is an essential first step toward building a peaceful and prosperous civic order. Accountability should start with the individuals who directly inflict the violence, whether police or military, but must also extend to those in command. When protests erupt, government must engage with the demonstrators and find credible ways to respond to their demands. Arrests should be made only when actual crimes are committed, and the accused must be given swift and fair trials.

Despite violent crackdowns, Kenyan youth are still protesting, and their Nigerian counterparts have pledged to return to the streets if their demands are not met. Other countries, such as Uganda, are also facing anti-government and anti-corruption protest movements. As long as governments lean on repressive tactics, rather than undertaking meaningful reforms, such upheaval will continue.

Project Syndicate

The number of verified Bank Verification Number (BVN) holders in Nigeria has soared to 65 million, according to the latest report published by the Nigeria Inter-Bank Settlement System (NIBSS).

The Bank Verification Number (BVN) system was introduced by the Central Bank of Nigeria (CBN) in 2014 as a biometric identification initiative aimed at reducing fraud and enhancing security in the banking industry. The BVN serves as a unique identifier that links bank accounts across multiple financial institutions, ensuring streamlined processes and improved customer verification. Since its inception, the system has grown exponentially, now covering a significant portion of Nigeria’s banked population.

Between April 2024 and July 2024 alone, the number of BVN-registered accounts grew from 61.47 million to 62.7 million, representing an increase of 854,267 in just three months. This upward trend, coupled with the surge to 65 million by August, signifies a growth of more than 4 million new verified BVN holders in 2024; a remarkable achievement in the drive toward full financial inclusion.

The Managing Director and Chief Executive Officerof NIBSS, Premier Oiwoh attributed the growth to continuous technological upgrades and innovation.

While the growth in BVN registration signals progress, industry experts have raised concerns about the 40% of the Nigerian population that remains financially excluded. The Enhancing Financial Innovation and Access (EFInA) Access to Finance (A2F) 2023 survey highlighted that despite the increasing adoption of digital services and urbanisation, many Nigerians still lack access to formal banking services. This gap is especially evident in rural areas, where low financial literacy and deep-seated mistrust of banking institutions persist.

Kurfi Garba, Managing Director of APT Securities, explained, “Many Nigerians remain unaware of the benefits of having a bank account. Financial literacy is still low, and cultural factors, such as mistrust of formal banking institutions, deter a significant portion of the population from participating in the formal financial sector.”

Garba also noted that there is a growing demand for alternative financial services, such as mobile wallets and payment service banks, which require less stringent identification processes compared to traditional banks. These options could potentially bridge the gap and increase financial inclusion, particularly for the unbanked and underbanked segments of the population.

Former Chief Economist at Coronation Merchant Bank, Chinwe Egwim, underscored the need for a holistic approach to increasing financial inclusion. “Improving financial literacy, fostering trust in formal financial institutions, and creating an enabling environment for economic growth are critical steps toward closing the financial inclusion gap. The banking sector must also invest in advanced cybersecurity to protect the BVN database and reassure customers that their personal data is secure.”

Egwim further stressed the importance of ongoing public education efforts, not only to promote the benefits of BVN registration but also to safeguard against fraud and identity theft. “As we continue to expand digital banking services, we must ensure that both urban and rural communities are equipped with the knowledge and tools needed to engage safely with these systems.”

By addressing these challenges head-on, experts note that Nigeria can fully capitalise on the advantages of the BVN system, paving the way for a more inclusive, secure, and technologically advanced financial ecosystem.

Sun