The Managing Director of Fairmoney Microfinance Bank, Henry Obiekea, has projected that fintech-driven institutions will feature prominently among Nigeria’s dominant banks in the coming years, as the sector undergoes structural reorganisation.

Obiekea said this during an interview with The PUNCH at his office in Lagos.

The PUNCH reports that most of the top banks in the country today are traditional banks, although the fintechs have been expanding their reach among banking customers in recent times.

He said, “If you look at the history of banking and how it has evolved, the 70s, the 80s, and the 90s, when they were called new generation banks, you saw that some of those new generation banks became leaders in the space. Our internal thesis is that within a five- to ten-year period, there will be some form of reorganisation. You’ll have about five major banks in Nigeria, and within those five banks, you will have a couple of fintech-based players.

“Our thinking is, how do we position ourselves to be one of those players? It’s a function of the products and services we provide and the unmet needs customers have. Many customers have been banking with traditional banks for a long time, but they have a love-hate relationship. Some of us are improving processes, products, services, and user experience, and that attracts customers to us. Traditional banks see the competition, and some have set up fintech subsidiaries to compete head-on. We think there’s a lot of room to push that reorganisation, attract more customers, serve people without access and those dissatisfied with current offerings, and gradually be part of that top five. It’s an interesting challenge and something that excites us.”

According to Obiekea, Fairmoney’s long-term strategy is built around deliberately positioning itself for that future.

Obiekea said Fairmoney’s expansion into servicing Small and Medium Enterprises represented a deliberate broadening of its business model, following its origins as a consumer-focused digital lender.

“FairMoney started primarily offering consumer credits, consumer loans, and unsecured consumer loans. In 2021, we obtained a microfinance banking licence from the Central Bank of Nigeria, and that was a good point for us, because what it meant was that we could offer additional services to customers, bringing us closer to the idea of being a financial services home for our customers.

“And then in 2023, we got into the SME merchant acquiring business, where we now began to offer services to SMEs,” he said.

Obiekea explained that this includes both payments and credit support for small businesses: “So now what we’re doing is, we’ve moved from a consumer focus to now offering services to SMEs as well, so giving them terminals, helping them accept payments, as well as providing them with loans as well, pocket capital loans to help them with their operations.”

Obiekea described Fairmoney’s current positioning as that of a credit-led institution expanding its reach.

Obiekea said Fairmoney’s growth has been supported by a deliberate focus on user experience, which he identified as a key reason customers are migrating from traditional banks to fintech platforms: “In some cases, it’s just the user experience that we are changing, and then it’s attracting those customers to us.”

He said Fairmoney identified gaps in how traditional banks treated depositors and responded by offering more attractive alternatives. “The traditional banks were offering customers little or nothing for their deposits because they had built a large base. So, what did we do? ‘Guys, come to us. We’ll offer you something attractive for your savings.”

According to him, this approach helped build trust and deepen customer relationships. “That way we were able to build a good customer base, build trust because again, banking is about trust, build trust, improve user experience with these customers, and then evolve to a situation where these deposits are coming now.”

Obiekea also linked ease of access to the broader idea of inclusion: “If I don’t have trust in the system, would I come to you for anything? Won’t I just keep my money under my pillow? If I need to take a bus from my village to the city to access a bank or something, is that not a problem for me?”

He said access and simplicity are critical to sustaining inclusion. “They also need very easy access to those financial products. And that’s when we are able to really and truly improve the inclusion that we talk about. Authentic financial inclusion is not just about financial inclusion but also about economic inclusion. If people don’t have money or trust, or access is difficult, inclusion doesn’t work. So, while we’ve put funds in people’s hands, they also need income and easy access to financial products. That’s how you truly improve inclusion,” he said.