The co-founder of Piggybank.ng, Joshua Chibueze, in this interview with SEYE JOSEPH, discussed myriads issues bordering on why it is hard to save in Nigeria, and how Piggybank.ng is changing this trend.
How do you get Nigerians to cultivate savings culture?
It is hard to save in Nigeria especially when you are not earning much. That is what most Nigerians think. However, some Nigerians who earn N50,000 have responsibility of N100,000 monthly. Many Nigerians live above their means. They need to save a certain amount of money every month but they do not have any means to make savings a reality. They turn to Ajo daily contributions, cooperative society; some Nigerians keep saving boxes at home.
Nigerian banks do not help Nigerians to save. That is why a bank gives you ATM card to encourage you to withdraw. It is something that is educational. What we do at Piggybank is to teach Nigerians how to save and the benefits attached to savings. We tell our customers that if they earn N50,000, they can save no matter their level of income.
What are the attractions of saving on Piggybank?
What differentiates Piggybank from other platforms is our discipline of withdrawal. We have fixed days of withdrawal. We have four fixed withdrawal days in a year when you can withdraw your money, free. Outside of that, we charge 5% withdrawal fee and we give 6% annual interest on savings. With Piggybank, you do not need to visit any bank. We do not have a branch. You can download Piggybank app from the internet.
We are venturing into other channels like USSD. It is safe, convenient, and easy to use. Piggybank works with commercial banks across Nigeria as long you have a Mastercard, VISA or Verve card. Piggy bank is a service. Our partner bank, UBA, held the funds. The funds are safe. When our customers want to make withdrawal, we transfer funds to accounts designated by the customers. This designated bank must have been registered at the point of onboarding.
How did you transit from digital savings to digital account?
Piggybank creates data for our customers. When a customer saves regularly for two to three months, a pattern emerges. We study this pattern. We generate an algorithm that helps to capture the data. We manage the data. We use the data in the future for loan disbursement. On our platform, you can set your account to auto save. This automatically deducts the money from your account. That is a standing order. Quick save feature is a manual where you save anything you want to save. It is free of charge to do that. There are no charges for transferring money from your bank account to Piggy Bank account.
Technology plays a huge role in Piggy Bank. What informed this decision?
We have experience in building platforms. We started from Covenant University. We have studied the space and we understand it. We have partnerships that have helped us to grow. We are working with Paystack, Flutterwave etc. Paystack is one of the good fintech companies around. This company helped with our processing payment from the card. Flutterwave helped with our disbursement. It is win-win collaboration.
What did you do to achieve this? Did you share APIs?
You cannot achieve success alone. We cannot build our own Paystack or Flutterwave just because we want to control the entire value chain. These partners do what they do very well. Our own priority is to focus on our key responsibility. We are focused on savings. Every other things we need to achieve we will collaborate with existing fintechs in Nigeria.
Have you been approached by investors?
Yes. We have investors that have approached us. They have given us money and all sorts. Interestingly, we have many local interests, even from the banks. We have had acquisition proposals. We have huge interests from the banks. We are not worry about that. It is only for us to choose the right ones, not just to the funds. You have to choose the right investors that will help your business to be in where you want it to be.
Have you encountered any bureaucratic bottleneck from government regulators?
The efforts of the Central Bank of Nigeria [CBN] are appreciated. The CBN has embraced fintech in Nigeria. Piggy Bank is a product of the microfinance bank policy of the CBN. However, the funds are held in UBA. It is a registered bank with the CBN, Nigeria Insurance Deposit Corporation [NIDC] and everything is insured. We do not have any bottleneck concerning regulation.
How do you manage customers’ identities?
To use our platform, you must have a bank account. Having a Piggy Bank is like operating a mobile wallet. We have information on the platform where you can enter your details, Bank Verification Number [BVN], next of kin, etc. It is easy to match those things.
What does the future holds for fintech?
Five years ago, I was not thinking about fintech. We were just passionate about solving societal problems. We are problem solvers. When you are in this kind of space, you must educate yourself, project into the future; stimulate growth to provide solution for the growth of the country. Everything we have learnt over the years has helped us to create. Everything is an experience. The future is digital. Few years from now, everything will be digital. We must understand the trend.
There is so much to expect. Fintech is a large market. You cannot look at it from 180 million-population viewpoint. You have to scale down to the number of people that have smart phones, people that have access to data. Digital is huge. There is a so much to be done. Some Nigerians are still under-banked. Some Nigerians do not have access to core financial services. We need to bring those into the system.