Only about 50 of the 1,565 registered financial institutions in Nigeria are on the internet, according to the Central Bank of Nigeria (CBN), writes O’SEUN OGUNSEITAN.

Only one in 30 financial institutions in Nigeria is on the internet. Official Central Bank of Nigeria (CBN) figures at the weekend indicated that less than 100 of the 1,565 registered financial institutions have any presence on the web. At less than six per cent, it is one of the lowest rates in the world.

The CBN figures, which showed that Microfinance Banks now account for one in every two financial institutions in the country, raised the prospect of Nigeria coming off the list of the world’s most under-banked nations. But the absence of basic internet presence, particularly by the micro banks, may delay the impact of the positive developments in the financial sector on the economy.

The figures indicated that while every one of Nigeria’s major 30 banks, comprising 24 universal banks, an old but fledgling commercial bank and five development banks have very good presence on the internet. The internet might as well not exist in the world of the country’s 734 microfinance banks. The report indicated that most other financial institutions have virtually no presence on the internet, at least officially.

Personal finance banking is powered across the world today mostly through the internet. The arrival of various ATM services has made information technology and the internet more important for modern banking.

Before the advent of the current banking regimen in the country, commercial banks were the main providers of personal banking services. The services were of the conventional salary and fees payment. But, even at that, more than 50 of the 80 or so commercial banks of the old regime were more of money retailing shops than anything near banks that are providing personal banking services. Aside of receiving salaries and paying school fees, they hardly offered any other visible personal banking services. The most personal interaction with banking and finance in the country then, were more with the hundreds of Bureau de Change businesses and finance companies in the country.

But, whereas several positive policy redirections in the banking industry has today seen to the emergence of 24 mega banks and hundreds of microfinance banks, it is yet to be seen how effective, the services of the microfinance banks will be, in the light of stack figures which indicate very low internet consciousness.

While it is true that they are products of a very recent new banking policy, there are now more microfinance banks in the country than Bureau De change businesses. But less than 50 of the lot have any internet presence known to the world or the Central Bank of Nigeria according to the financial institutions data published by the CBN.

The report said whereas less than 200 brand new Bureau De Change licenses were issued in the last two years to take the total number of registered Bureau De Change (BDC) in the country to 701, about 731 microfinance bank licences were issued over the same period. Some 20 months ago, according to the CBN, there were only three microfinance Banks in Nigeria.

Worldwide today, the internet and presence on the web, is regarded as one of the most cost effective marketing tools to reach and be reached by an unlimited number of people across borders. By statute, microfinance banks are expected to be more responsive to banking needs at the lower levels of the community, suggesting greater need for micro banks to deploy such modern tools for their operations.

Also according to the official CBN data, Lagos, the Nigerian commercial nerve centre, continues to attract the interest of financial sector investors more than any other Nigerian state including the Federal Capital Territory. The state is officially the registered home of 708 of Nigeria’s 1,565 financial institutions.

But the attraction is seemingly no more than mere presence in Lagos, as investigation by The Nation has found that even though Lagos State is officially harbours the headquarters branch of one in every two financial institutions in the country, the cosmopolitan nature of the state and the availability of many internet connectivity options, in many towns within the state, are positive factors yet to rob off the Nigerian financial sector in the area of internet presence.

Experts believe many factors account for the slow adoption of the internet as a media tool by Nigeria’s financial institutions. Curiously price affordability was not even mentioned in a random survey by The Nation.

The relatively poor understanding of the issues involved in putting up a website and using such tool to reach out, even among enlightened Nigerians, was rated higher than cost, as a reason for the low level of web presence by Nigerian financial institutions.

Average website design and hosting cost in Lagos, as in most of Nigeria, is considerably moderate. Professional web designers will deliver attractive and effective corporate-style interactive websites for as low as N80, 000, including the hosting of the website for a whole year. There are even do-it-yourself website design tools that cost almost nothing more than a few days of mastery and less than N40, 000 for a year’s hosting of the designed website.

But while some industry players and watchers are of the opinion that "things will change", some argue that the ease of having a presence on the internet ought to have seen at least half of the licensed microfinance banks having an internet presence by now. The argument is that if the promoters of the banks understood what internet presence entail, some would have registered unique domain (website) names, immediately they got provisional operating licences last year.