Nigeria’s First Bank Incredulous 30 Million Target

Nigeria’s First Bank Incredulous 30 Million Target

First Bank of Nigeria is an eminent banking institution. It has top-rate managers and arguably one of the finest companies in Nigeria. But recently, First Bank is making statements that confound any careful observer. The latest one is its plan to add 16 million customers in the next three years, by broadening its digital marketing. Since 1894 (note “8”), the bank has added only 14 million customers till date. Then in three years, it will magically add 16 million new customers. The bank is not clear on how it will execute such an audacious target that may risk making the managers look weak in a scenario they fail..

First Bank of Nigeria Ltd , one of Nigeria’s pioneer financial institutions, has said it is currently broadening its digital marketing initiatives in a bid to add 16 million customers to the present 14 million customers.

According to Dr. Adesola Adedutan, FirstBank’s Managing Director/Chief Executive, said this is part of its growth strategy to get 30 million customers over the next three years, and to migrate its existing and new customers to alternative channels, namely First Online, Firstmobile, USSD and ATM cards.

He said,“We have a focus of building our customer base to 30 million in the next three years from the 14 million we currently have. That is the way forward for us and we are making significant progress already.”

First Bank is not a Nigerian political party. I hold the bank shares. I make time to know what is happening in the bank. But recently, First Bank is talking like APC and PDP. Sometimes, the bank makes statements without supporting insights. If anyone believes that First Bank will add 16 million new customers in three years when it took it more than a century for 14 million, I have a bridge to sell that person.

The bank needs to know that it may need to first buy other big banks like GTBank and UBA before it can get closer to 12 million new customers (most customers have multiple bank accounts so if you sort  and combine them, the number of unique customers will drop from a combined total). GTBank has 8.3 million customers. UBA has about 8 million customers. If you combine GTBank and UBA, you may get about 12 million unique customers. Of course, First Bank cannot buy GTBank, the reverse is more plausible. First Bank is worth around N207 billion while GTBank is worth about N1.12 trillion in the Nigerian Stock Exchange excluding its listing in Europe.  So, I do not know where these 16 million new customers will come from within three years for First Bank if big acquisition is not the path.

In short, it is nearly impossible, using today’s data, for First Bank to execute this target. The total number of unique Nigerian bank customers is less than 30 million. (It could have gone up, but not certainly more than 40 million.) Yet, a bank CEO will tell the world that it can get 30 million customers. If you subtract the 14 million customers First Bank currently has, what will remain is 16 million customers. Simply, if First Bank should succeed, on this target, it does imply that every Nigerian bank customer must have an account with it.

It is estimated that the Bank Verification Number exercise which links customers with their biometric data like facial features and fingerprints generated about 25 million unique customers in Nigeria. Those 25 million customers accounted for about 45 million bank accounts in Nigeria.

The numbers are relatively poor for a country of more than 180 million people. For the banks to get their next 30 million customers, they need to improve their games

We need to become a country that is more fact-based and common sense-driven, especially in an industry that holds the economy. Banks must speak with common sense. They are not political parties. In U.S., analysts would have challenged First Bank to show how it will get to this huge customer base. But in Nigeria, no one cares. The press just reported it and moved on.

Of course, I concede that the digital marketing can target more than 80 million Nigerian adults who are not yet in the banking sector. That is mathematically possible. Yet, I do not know how many of those 80 million people anyone can reach digitally within three years. But First Bank may have its strategy in the vault; 2021 will tell us how solid it is. But for today, I find it incredulous because the basic elements of the markets do not support such level of growth.


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2 thoughts on “Nigeria’s First Bank Incredulous 30 Million Target

  1. In reality, we have more unbanked Nigerians than the numbers in the banking system. While I agree the target is confounding, if the bank’s focus is not on HNIs, then they will make much progress.
    USSD, Mobile banking and cardless banking has lowered the entry barrier for Nigerians who live off grid. The pertinent question is “is First Bank willing to tap into the market previously left to microfinance banks? Are they willing to focus on the farmers, the construction site workers and the nick nack sellers? The profit margin in that sector is minute, but they will get the desired customer volume.


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