Frustration of bank customers during public holidays

Many depositors were disappointed during the Christmas and New Year holidays, as several electronic platforms were epileptic, leading to failed or delayed transactions. Analysts say this has raised doubt over the Central Bank of Nigeria’s drive for the implementation of the cashless policy.

The CBN had in a letter to banks in the country set January 9, 2023, as the commencement date for the implementation of the cashless policy.

From January 9, withdrawals from the banking systems across the country will be restricted, the apex stated in the directive issued through a circular by the Director of Banking Supervision, Haruna Mustafa, dated December 6, 2022, with SD/DIR/PUB/LAB/015/069 as reference number, entitled, ‘Letter to All Deposit Money Banks and Other Financial Institutions, Payment Service Banks, Primary Mortgage Banks, and Microfinance Banks’.

According to the CBN, the circular is in line with its cashless policy. It directed that maximum Over-The-Counter cash withdrawal by individuals and corporate organisations per week shall, henceforth, be N100,000 and N500,000, respectively, starting from January 9.

Against the foregoing, not a few bank customers are pessimistic about the feasibility of the cashless policy, which the CBN aims to achieve through the directives. In fact, most underserved customers, who carried out transactions on banks’ e-channel platforms during the Yuletide, bemoaned the unprecedented poor banking communication network throughout the season, and expressed doubt about the feasibility of the cashless policy.


Customers recount experiences

Kingsley Egerue, a Lagos-based businessman, said he made several attempts to check his account balance but to no avail, and lamenting that even at that he charged for the poor service.

He said, “Everything was frustrating. Checking my account balance was so frustrating, even as service charges were deducted from my account. Not only that, sending money to family members and friends was equally frustrating, as their accounts were not credited, even when my account was debited. Also, many ATMs did not dispense cash.

Head of Tax and Corporate Advisory Services at PricewaterhouseCoopers Nigeria, Taiwo Oyedele, who was a victim of bank e-channel failures, said the biggest impediment against the adoption of e-payments and by extension, the cashless economy objective in Nigeria, is poor infrastructure.

At a media parley recently, hr said, “The problem has always been with us, but it seems to get worse during periods of high commercial activities such as the Yuletide. I experienced this myself over the Christmas period and had to resort to cash payments and bank transfers in some cases. “Unfortunately for many businesses, you can’t do bank transfers for OTC purchases. Imagine the impact on their sales, if you also can’t withdraw cash to pay them due to withdrawal limits.”

Oyedele urged the CBN to prioritise the improvement of these infrastructure, in collaboration with other key stakeholders within the value chain, before implementing the new cash withdrawal limits. “If not, economic activities would be negatively impacted, which could lead to a drop in Gross Domestic Product or even a recession,” he added.

He cited India as a classic reminder of what could go wrong with a hasty and poorly planned economy policy.

“I think it’s a temporary glitch as a result of the spike in transactions over the holidays,” said Tope Fasua, the Chief Executive Officer of Global Analytics Consulting Limited.

In a similar vein, Martins Egbon said, “Banks, ahead of any festivity, should always be proactive, as there is usually overcrowding in transactions during the festive period. They should always be prepared for it.”


Stakeholders express concern

Muda Yusuf, Director of the Centre for the Promotion of Private Enterprise, at a media parley, said electronic transaction failures would create more problems for citizens and businesses.

According to him,  such transaction failures slow economic activities, especially at a time the CBN is pushing people into a cashless economy.

He said, “If CBN must achieve a cashless policy, it must be ready. That readiness in terms of infrastructure is not there, though it has made some progress. Before you become more bullish, you must make sure that the infrastructure is there.

“It is not a good thing for the economy, and that also underscored the need for the government to override the CBN to slow down on the pace of the cashless policy. If the people in the urban areas are having issues with e-channel, what about people in the remote areas where there are no networks and no banks?”

The CBN introduced the cashless policy on April 1, 2012, with the overall objective of reducing the use of cash in the economy, encouraging electronic transactions, and enhancing the efficiency of the Nigerian payments system.

Against the backdrop, Mr Oliseh Ifeduba said, “Even if banks have been encouraging customers to always use the e-channels for seamless, fast transactions, they seem not to be improving on their services through the electronic channels.”

One of the achievements of the cashless policy, according to CBN’s Deputy Governor in Charge of Financial System Stability, Aisha Ahmad, is an expansion in financial access points, including ATM, Point of Sale and mCash, which have recorded significant increases under the cashless policy.

Sequel to the naira redesign policy announced by the CBN on October 26, 2022, the apex bank suspended charges on cash deposits above specified thresholds under the cashless policy to ensure seamless implementation of the policy and to encourage the public to deposit their funds before the January 31, 2023 deadline, she said.

Ostensibly appraising the worsening situation of poor customer service, Damian Nnayelugo said, “Impact of technology on customer service in the banking sector over the decades has become obvious that no bank needs to be told that its services to customers need to be improved upon by investing in new technologies to further satisfy customers subscribed to its services.

Technologies have so deepened their roots in the banking landscape that discrepancies between the so-called old generation and new generation banks are no longer there. This is because many banks have invested so much to accommodate technology.

Interestingly, if they don’t do this, they will become irrelevant. And in the end, they will still navigate towards tech.


Way forward

Since the disappointment was experienced by not a few customers, many have been calling for an improvement in digital banking and complaints resolutions. Customers are notably calling for improvement in banking services, especially in the area of digital banking, complaints resolutions, lending, and interest charges.

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