Boosting Microfinance Banks with Digital Solutions

The recent launch of mobile banking app for small-sized microfinance banks and other technology solutions by Interswitch, will enhance digital transformation in the financial sector, writes Emma Okonji

Financial Technology (Fintech) companies like Interswitch, have continued to disrupt the financial sector of the Nigerian economy, with technology solutions that are driving the payment and e-commerce sectors.

Recently, Interswitch Group, Africa’s integrated digital payment and e-commerce company, and the Central Bank of Nigeria (CBN), stressed the need for collaborative innovation that would further drive the Nigerian payment industry ecosystem.

They made the assertion at a two-day technology event organised by Interswitch, tagged ‘Collaborating for Industry Growth and Profitability,’ where industry players gathered to discuss how to strengthen the digital payment ecosystem and position Nigeria as a force to reckon with on the global payment landscape.

The industry leaders, drawn from banks, fintechs, micro-finance banks, telcos and other financial institutions, reached the resolve that designing innovative financial products which speak to the needs of customers would spur growth and economic prosperity.

The experts also noted that players in the financial space needed to synergise to explore avenues for mutual growth that would in turn create a robust payment ecosystem.

At the two-day event, Interswitch launched series of tech solutions for small medium and large scale enterprises that would enable them serve their large customer base in the digital transformation era.  

Mobile Banking-as-a-Service

One of the solutions launched by Interswitch, was the Mobile Banking app to avail medium and small-sized microfinance banks to offer digital financial services to their numerous customers. 

Customers of Micro Finance Banks (MFBs) will be able to download the app from the app store.  The app include major banking features to cater to every client’s need such as money transfers, mobile top ups, bills payment, self service requests, card services among others.

Payment-as-a-Service

Another solution released by Interswitch, is the Payment-as-a-Service (PAAS), which is a payment platform that will allow financial institution and Fintechs extend payments services to their customers. PAAS will enable financial institution perform the usual cards issuance, process transactions, access to collections and disbursement platforms. It will allow financial institutions to rapidly integrate to newer payment channels.  

Fraud Solution As A Service

In order to protect financial transactions at all times, Interswitch also developed Fraud Solution As A Service (FSAAS). In recent times, reported cases of electronic fraud have been on the rise, which calls for urgent attention as stakeholders are urging financial service providers to design products that will help mitigate and curb fraud to the barest minimum.

To this end, Interswitch launched FSAAS to help fight fraud and financial crime 

FSAAS helps to protect customers against payments fraud tendencies.

Specifically, it protects customers against card fraud, application fraud, payment fraud, merchant acquiring fraud and money laundering among others.

The products are tailored to provide seamless payment solution to banks, fintechs, micro-finance banks, other financial institutions and their customers. They are designed to help improve the digital payment solutions that financial institutions offer to their customers.

Critical pain points the products will be solving include protecting customers against digital payment fraud, effective value financing tools for lenders, seamless integration to payment channels, enhanced customer experience, among others.

Commitment to Financial Services

Speaking during a panel session, Managing Director, Interswitch Purepay, Akeem Lawal, said players in the payment industry must collaborate to provide opportunities to co-create solutions that make digital payment safer and further drive profitability. 

He said: “Interswitch is committed to partnering with stakeholders to continuously drive financial inclusion through its innovative products and solutions. These products reaffirm the company’s continued drive to improving Nigeria’s digital payments landscape through innovation and the development of first-rate solutions and infrastructure that address pressing needs in the payments ecosystem.”

Lawal further said Interswitch would continue to enter partnerships that will not only simplify payments, but also drive prosperity across the continent.

Director, Payment System Management Department, CBN, Jimoh Musa, said CBN’s responsibility as a regulator is to create an enabling environment where all the entrants can thrive and compete healthily.

“We understudy all the interoperable operations of each technology company, and all the participants generally. And from time to time, we bring all these entities together to dialogue to enable us to decide what the best industry practice is in relation to Nigeria’s payment ecosystem,” Musa said.

The panelists noted that partnerships would allow players increase revenue and grow faster, avail them opportunities to leverage one another’s infrastructure, drive financial inclusion and build a robust ecosystem.

The panelists also urged players to collaborate more to provide quality service for the end users to enhance growth and more opportunities.