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Massive job loss looms in the banking sector

As Nigerian banks are moving to the technology era, its workers might lose their jobs as the new technologies carry out tasks that are meant for workers.

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Financial Technology FinTech, Job loss, Accion Venture Lab, Fintech: Growth frontier of the next decade 

Nigerian banks are beginning to review their business model which is still very much the traditional banking system as technology is penetrating deeper into the tasks that workers carry out.

Technology has already compelled some banks to limit their expansion rate, while others are shutting down their brick and mortar structures to accommodate technology. All these are happening because technology is projected to handle 30% of the work currently done at banks.

Part of the 30% of work that will be taken over by technology is collation of tellers. This means that the staffs who work as tellers will be major casualties of the onslaught of technology. Banks are reviewing their work system because in the next two to three years, teller jobs would likely be phased out by the financial institutions.

Speaking on the projected job loss, the President, Chartered Institute of Bankers of Nigeria (CIBN), Uche Olowu, said the downsizing might occur because the banks’ traditional business model is being threatened. According to him, banks are now investing in financial technology rather than invest in expansion or brick and mortar building which will accommodate more jobs.

[READ MORE: CBN now has its eyes on Fintechs’ activities]

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Uche Olowu, the President of CIBN

Apart from their investments in Fintech, banks are also investing in specialised human capital. This paradigm shift in investment focus of banks is expected to affect departments that can be technologically driven.

While defending the actions taken by banks, the Managing Director/CEO, Ecobank Nigeria, Patrick Akinwuntan, said the infusion of technology into banking services was done in a bid to remain relevant as banks gradually lose monopoly over financial transactions.

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Nairametrics had previously reported that the future of banks was under threat from FinTech startups and telecoms companies which received approval from the Central Bank of Nigeria (CBN) to conduct mobile money service. They were given pproval to enable the apex bank achieve its 80% financial inclusion by 2020. However, the growing popularity of FinTech startups and functionality of network providers as Payment Service Banks has placed some jobs in banks in jeopardy, as customers continue to get more reasons not to visit banks for some financial transactions which can now be done anywhere.

[READ MORE: CBN set to backtrack on its costly new regulation for fintechs]

Olalekan is a certified media practitioner from the Nigerian Institute of Journalism (NIJ). In the era of media convergence, Olalekan is a valuable asset, with ability to curate and broadcast news. His zeal to write was developed out of passion to shape people’s thought and opinion; serving as a guideline for their daily lives. Contact for tips: [email protected]

1 Comment

1 Comment

  1. Anonymous

    August 29, 2019 at 10:05 am

    Some banks didnt improve their technology. While some did, banks that invested in technology are not closing down branches or massively sacking their members of staff. Fintech and (Telecommunications) companies are now disrupting the banking space by providing financial services. Banks that failed in the past to invest in their technologies are now having serious competition. To survive , banks must do more than the traditional banking.

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Energy

Togo, Niger, Benin remit N2.04 billion to Nigeria for power supply

Nigerian Electricity Regulatory Commission says international electricity customers remitted the sum of N2.04billion to Nigeria in three months.

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NERC postpones increase of electricity tariffs

Nigeria’s international electricity customers – Togo, Niger, and Benin, remitted the sum of N2.04billion in the first quarter of 2020, as their outstanding electricity bill to the Market Operator (MO) of the sector in Nigeria.

This was found in the Nigerian Electricity Regulatory Commission 2020 first quarter report, which was released recently.

According to the report, a total of N4.05billion ($13.22million) invoices were issued by the MO to international customers including Societe Nigerienne d’electricite or NIGELEC; Societe Beninoise d’Energie Electrique (SBEE); and Compagnie Energie Electrique du Togo (CEET).

The commission stated that during the quarter, NIGELEC made a payment of ₦1.61billion ($5.27million) as part of its outstanding bills for the energy received from NBET and services rendered by the MO.

It stated, “Similarly, SBEE paid ₦0.43billion ($1.39million) in respect of services received from MO.

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“It was noteworthy that tariff shortfall (represented by the difference between actual end-user tariffs payable by consumers and the cost-reflective rates approved by NERC) had partly contributed to liquidity challenges being experienced in the industry.

“The settlement ratio to the expected Minimum Remittance Thresholds, having adjusted for tariff shortfall, indicated that power distribution companies needed to improve on their performance.”

But

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Special customers like Ajaokuta Steel Co. Ltd and others in its environs did not make any payment in respect of the N0.27billion and N0.05billion invoices issued to them by the Nigerian Bulk Electricity Trading Plc and the MO respectively, during the period under view.

Meanwhile, the power distributors failed to remit N119.88billion to the sector within the same period.

Whereas Discos were expected to make a market remittance of 46.09% during 2020/Q1, only 32.53% settlement rate was achieved within the timeframe provided for market settlement in the Market Rules,” it added.

What it means: The Discos’ remittance level, regardless of the prevailing tariff shortfall, was still below the expected MRT and they are expected to improve on their performances.

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ENDSARS

#EndSARS: Protests may return if panels do not address all issues in 2 weeks – Former Nigerian Minister

Akinyemi says the #EndSARS protesters would return to the streets if their demands are not addressed in two weeks.

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This was disclosed by Professor Bolaji Akinyemi, during a news interview with ARISE TV this afternoon, as he called on the FG to urgently address the issues raised by the protesters, as these issues extend beyond police brutality and the immediate reform of the Nigeria Police force.
He explained during the interview that the current demands of the youths extend beyond basic needs, which remain the core mandate of the present administration.
He likened the #EndSARS protest to the #BlackLivesMatter demonstration and reiterated that demands of the youth extend beyond stomach infrastructure, as it is more of a call for good governance in a bid to address the concrete issues that the country faces.
He called for strategic actions towards combatting the evils of unemployment in Nigeria; called on the military to employ more military men to soak up the unemployment, and also provide security for the country.
On the issue of restructuring, Professor Akinyemi said restructuring is also key to solving the many problems facing the country.
The Professor of Political Science noted that the way forward for Nigeria will be for the government to utilize the Justice Mohammed Uwais report on electoral reforms and the 2014 National Conference report, which he believes addresses the issues confronting Nigerians.
What they are saying
During the interview, Professor Akinyemi said, “I will say and let me believe I am wrong, the judicial panels have just two weeks to address all these issues before the youths come back to the streets. The government should at least give the youths the impression that you have not set up all these panels to buy time, but that you are genuinely and seriously interested in addressing their issues.”
He reiterated the need for the employment of more police officers,
We told the government, because I was part of that conference, that the United Nations said Nigeria needs 1.5 million policemen. We have only about 350,000 and we were recommending that the Nigerian government should employ 750,000 more policemen.”
What we’ve seen in the past two weeks is that we don’t have enough men in uniform to guarantee security in this country if every part of the country decides to blow up. So you serve two purposes – employment and security, and those are things you can do immediately.
“We have just seen how every Governor was scrambling around in the past two weeks; if you allow each state to have its own state police, you wouldn’t have that experience. I have heard of a situation where the streets took over even governance in almost every state. So, restructuring is that you allow things to be done at the local level.”

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Coronavirus

COVID-19: Jason Njoku and wife test positive

iROKOtv CEO and wife have contracted the novel coronavirus.

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Jason Njoku and Wife testes positive to Covid-19

Jason Chukwuma Njoku, the co-founder and CEO of iROKOtv and his wife has tested positive for COVID-19. However, Mrs. Mary Njoku is feeling well.

Jason,  disclosed this via his Twitter handle stating that “My enemies are hard at work in 2020. Mrs. Njoku and I tested positive for Covid-19. I’m not feeling great, but Mary is well. Literally no idea how I caught it. But we shall see this pass too.”

The media mogul did not reveal if his children caught the virus too.

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