#BounceExclusive: 5 Things You Should Know About Piggybank.ng
Jeffrey got a job in 2015 almost immediately after his National Youth Service (a very rare scenario in Nigeria).
But after working for one year, he could not say for sure where all his earnings had gone.
As a matter of fact, he had always found himself broke several times before his paycheck arrived.
It was in the beginning of 2016 that he resolved that a part of every kobo he earned was his to keep.
So, he opened an account with Piggybank.ng where money he must never spend goes to.
One year later, Jeffrey has been counting his gains.
Like Jeffery, there are thousands of others who are already sharing their testimonies about the online savings platform, Piggybank.ng
The online service is becoming quite popular among Nigerians.
But after the sad stories and heartbreaks of popular ponzi scheme, MMM, it has become imperative to investigate the authenticity of any financial technology solution before educating the public about it.
So, Bounce News paid a visit to Piggybank’s office in Lagos. And after a chat with the co-founder, Joshua Chibueze, below are 5 things we learnt which covers basically everything you need to know.
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1. Piggybank Is Not A 'Normal' Bank: Yes, Piggybank is not a house where money is kept and you can walk in at anytime to do some transaction.
It is a service and like its original meaning - a savings box – it is a digital savings box.
According to Chibueze, “It’s a financial technology service that helps people save. All the funds are warehoused and monitored by Piggybank’s partner, United Bank for Africa, UBA.”
2. Piggybank Does Not Have Access To Your Savings: Although you save your money with Piggybank, the operators do not have access to any money you save.
The reason is because, when you are saving with Piggybank, they do not collect the money directly from you.
A payment processor called Paystack helps them to collect the money from you.
3. Piggybank Does Not Make Money Directly From Your Savings: That is correct. When you save with Piggybank, you do not pay any fees for the service except you decide to cash out outside the four periods allowed.
So, Piggybank only makes money when UBA invests the total savings on the platform in government securities such as bonds, treasury bills, etc.
The returns on these investments help piggybank to pay you 6% annual interest rates on your savings and also make money for themselves.
The 6% is spread 1.5% every quarter. Every quarter, Piggybank checks your account, and as long as your savings plan is active, they’ll add 1.5% to your balance.
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4. Piggybank Does Not Assume Any Liability On Your Savings: The money you save with Piggybank is held in UBA. Simply put, Piggybank is an extension of a savings account with UBA.
So, the liability lies with UBA and not Piggybank.
If you wake tomorrow and you can’t find Josh or Piggybank, you can hold UBA accountable.
But since UBA is licenced, regulated by CBN and insured by the Nigeria Deposit Insurance Corporation, NDIC you can go to bed with both eyes closed.
Moreover, you can actually add your next of kin on your Piggybank account, so that if anything happens, the next of kin can claim your estate.
5. Piggybank Is Not Regulated By CBN: This issue of regulation cannot be over-flogged because when people save money in a platform, their greatest concern is identifying who to hold accountable if anything goes wrong.
Since Piggybank does not have a banking licence (because it is not a bank), the CBN cannot regulate it. The closest CBN has come to regulating it is imposing a savings limit of 200,000 naira per month to forestall money laundering activities.
More so, because Piggybank does not have access to your money, there is no point really to regulate them.
As long as the CBN keeps their eyes on UBA or other partner banks, your money with Piggybank is safe.
It is also important to note that Piggybank is not a payment processor. It does not help you pay for goods and services. It is a technology layer on top of what the banks have, helping grow your savings.
So, start saving - piggybank is here to stay and you are not too young to save.