I have a bank account that is very close to my heart. Service is great, accessibility almost ubiquitous, I get my statement on time and don’t even need to have an account officer or even know anybody in the bank to get things done. The ATM card works just fine and can be used to buy just about anything from any part of the world. It even has my picture on it and can be used as an ID card in special cases. That bank like you’ve probably guessed is not a Nigerian Bank. It’s an American Bank account which though is far from perfect, is still a useful barometer for banking services in Nigeria.
Like most Nigerians who deposit money in Banks, I have multiple bank accounts, several ATM cards, fill countless KYC forms, and off-course numerous inefficient and seasonal account officers. I have complained severally and decided it was time I made a list of changes I want from Nigerian Banks.
Account Officers –Account Officers are a set of supposedly nice guys in banks who mostly double as marketers and relationship managers. Whilst nearly every bank customer has an assigned account officer not every bank customer knows their account officers. Your relationship with an account officer largely depends on how much money you have with the bank and the volume of business you transact. Account officers are supposed to help you obtain bank loans to finance your business, help you with issues related to your account with the bank and off-course ensure that you continue to deposit your money with their bank. Much of these services are obviously skewed towards mobilizing deposits. Just call your account officer to come collect a cheque and boom they are in your face. Call to get your bank statements and you will be asked to write some boring letter. Banks must separate marketers from relationship managers if customer service is really important to them.
Those freaking KYC Forms –?I heard by early 2013, the Central Bank will once again be releasing new set of guidelines for filling KYC (Know Your Customer) forms. If you recall, sometime last year all account holders in Nigerian banks were subjected to filling out this forms irrespective of the number of accounts that you had. I found that process quite old fashioned and out of touch with modern banking practices. Rather than have customers fill in some scrappy forms, I would have thought provision of valid identification, such as International Passports, voter’s registration card could have been a more reliable way of confirming addresses than the fickle utility bills. For majority of bank customers with access to internet banking, options should be given to them to update their records online.
Account Confirmation Sucks –?This a very common phenomenon among all banks in Nigeria and cuts across two ways. Nearly every Nigerian who has had reason to go to the bank to cash a third party cheque has had to wait and be delayed because the issuer of the cheque needs to confirm. I find this process utterly ludicrous when I argue with my bankers because I believe the fact that a cheque has been issued is in itself an instruction to pay. I have also argued with lawyers that a delay on a payment of cheque due to confirmation issues is civil offense and should be challenged in court someday. I don?t understand why a beneficiary of a cheque needs to wait endlessly and in some cases get returned from clearing. Maybe the CBN should designation confirmation letters as instruments of payments which may accompany cheques.
Alert Cost Exploitation –?Text messages notifying account holders of activities on their accounts became popular about a decade ago. Since then, its not hard to imagine how much Banks and telecom service providers must have made by charging their customers for this service. Recently, the CBN reached a land mark arrangement with banks requesting that the N100 charge third party withdrawals on ATM’s be stopped. I believe alerts should also fall under that umbrella. There are various online platforms which offer free sms?s that banks can use.
Internet Banking is a burden -?I love to use the world wide web because of its ubiquity and ease of use. Several banks offer internet banking platforms which are quite effective. However, apart from checking your balances, transferring money and printing your banks statements there is little more one can do with online banking. I expect banks to also offer a wider range of services that can help depositors maximize other banking solutions. For example, I need not fill in those tacky KYC forms if I can just regularly update my records online. I should also be able to lodge in confirmation request online, if such restrictions are placed on their accounts for cheque payments. Small Businesses can also benefit from personal finance tips and guide to obtaining loans from bank websites. Finally, Nigerian banks need to redesign the inter-phase of their websites. So many clutters it discourages even an online enthusiast like me from spending an extra second after I perform transactions.
And those Tokens too –?I have a mobile token which I greatly rely upon to conduct online banking transactions that require up to 6 digit transfers. Whilst their security features cannot be much criticized, the fact that they are just one more extra item to carry with me is a turn off. So, my car keys, cellphone(s), wallet, business card carrier, flash-drives ?ID cards, will have to compete with the Tokens as carry on items in my pocket and/or my bag. They also claim the security codes are meant to last for 1 minute then it goes off which from experience never happens. The most you get is 10 seconds and so if your memory is such that you have to look frequently at numbers before it sticks, multiple declines in your transactions will become a common feature. The tokens while reliable needs to be more?convenient?to carry and use.
Mobile Banking Sucks –?According to the?Accenture?69% of internet users in the world did so through a mobile device. That reveals how dependent people are on their mobile phones for surfing the internet. Unfortunately, those who use their mobile phones for online banking transactions will mostly agree that the experience is horrible. Only a handful of Nigerian banks have mobile apps that customers can use easily to perform banking transactions. As such, they have to depend on same inter-phase users of laptops and desktop computers rely upon. This has to improve too, as banks can introduce their mobile apps on Android, Blackberry, Apple and Windows operating systems. That same report says 61% of those who used their mobile to browse did so with smartphones.
ATM’s –?Thanks to the Central Bank and effective promotion by banks most Nigerians now have an ATM card. According to the CBN, the volume of ATM transactions rose 8.3% to N178,421,736. It is also the dominant form of e-payment transactions garnering over 90% of?e-payment. But whilst the ATM cards seem effective and handy for me, the machines that they so rely upon to work often times run out of cash or is bogged down by network issues. My heart is always in my mouth whenever I try withdrawing money from an ATM on Sunday evenings. Even banks that claim to have Mobile Banking Halls with over half a dozen ATM’s are not excluded. In some cases, half of the machines are either out of cash or simply not working. Another annoying experience is the term ?financial institution not available, whatever that means!! And my God, those POS terminals!! Never pray to find yourself in a situation where its your last resort at a restaurant or bar anywhere in Lagos. ATM’s need to be more reliable and effective in Nigeria.
Cash-less Banking -?This got introduced this year by the CBN in Lagos to discourage transactions involving movement of high volume of cash. It has mostly been effective as cheque transactions has continued to be on the decline. Whilst I support the policy, I believe it can be improved and the CBN along with banks can make it’s alternative a lot more stress free for most depositors. Whats the point going cash-less when a lot of businesses including government agencies still require that cash payments be made. Try going cash-less when your’e paying clearing fees for your goods or paying for a ticket at the airport. Lots of agencies and business still encourage cash payments leaving users with no option but to withdraw cash through very risky and time wasting means.
Deposit vs Lending Rates –This year, Nigerian banks collectively look set to make profits of over N400billion in profits this year just as AMCON has announced a loss of over N2 trillion. Much of the banks fortunes have come at the expense of AMCON and depositors who continue to save money at single digit below inflation rate and borrow from the banks at over 20%pa. This has to stop as well as I have reiterated in my blog in the past. The banks need to cut down on their cost of funds, which they can no longer rely upon to charge depositors high interest rates yet short change them by paying them very low deposit rates.
What are yours??