BY Amechi Ogbonna
IT is indeed difficult to imagine any sector of the Nigerian economy that has recently undergone as much transformation in its day-to-day operations as the banking sector. Increasing sophistication in the lifestyle of its major clientele, changing tastes, and demanding official schedules amongst many others have seen the sector operators, really stretched in their adaptations aimed at meeting the needs of their demanding clientele.
But one untapped area many observers believe still needs attention is the rank of the unbanked in the economy and how to reach them. Talk about the masses, the low income earners, artisans and traders whose daily returns are in the range of hundreds, but who as it were need banking services. With the introduction of e-banking by the Central Bank of Nigeria (CBN), there has been a drastic reduction in real time spent by customers on transactions considering that by merely logging into the internet and pressing some prompts, a bank customer can conclude his transactions in record time and in a most convenient atmosphere.
Electronic banking is speedily changing the landscape of the banking industry, blurring the boundaries between different financial institutions, enabling new financial products and services and making existing financial services available in different packages.
Although system failures and poor connectivity in the face of the comparably low technological development in the country are some of the challenges hindering the innovations, what perhaps is not in dispute, however, is that for organisations that know how to deploy it, electronic banking has increased efficiency in banking and its services. It has accounted for the drastic reduction in operating costs on the part of both banks and customers. While the requirements for online banking services differ from bank to bank, however, it is important to have an internet-enabled PC, which enables access to one account(s) and some bank service interfaces.
The CBN has stipulated that all financial institutions must ensure that their Internet Service Providers (ISPs) have implemented a firewall to protect their institutions’ websites where outsourced and that banks should ensure that installed firewalls are properly configured with procedures for continued monitoring and maintenance arrangements. Banks should ensure that summary-level reports showing website usage, transaction volume, system problem logs and transaction exception reports are made available to the bank by the Web administrator.
It does not, however, stop there. Erring banks are to incur levels of sanctions, including monetary penalties and or suspension of the specific electronic banking activity(ies) or both.
In addition, they are to seek CBN’s approval before launching, implementing or enhancing electronic banking services and products to be submitted within the prescribed deadline, the required information and documents. On the other hand, customers that can use e-banking services should either be residents of Nigeria with verifiable addresses or any person residing physically in Nigeria as a citizen under a resident permit or other legal residency designation under the Nigerian Immigration Act. Also, any person known herein as a “classified person” who neither meets condition (i) nor (ii) above but is temporarily in Nigeria may utilise e-banking services limited to acceptance services such as ATMs, PoS terminals or other acceptance devices deployed by a regulated institution.
However, some people are of the view that the emerging trend in internet banking in Nigeria is of global concern. Despite this argument, one thing that is clear to all is that the Nigerian economy remains a strong force in Africa. The country also has a high reputation for internet-related frauds in the world, having been inferred- “the headquarters of Advance Fee Fraud”. Preparatory to the full launch of the e-scheme, the CBN carried out a sensitisation campaign in major towns of the six-geopolitical zones, namely Lagos, Port Harcourt, Enugu, Gombe, Kaduna and the Federal Capital Territory.
Amidst some of the enumerated hiccups, does it then mean we should not embrace innovative platforms introduced by service-oriented operators in our economy? The truth is that the method and manner of doing business in the country has been redefined for good. Now more convenient and fast, it is only expected that people will embrace it.
However, of particular interest is the First City Monument Bank (FCMB) response to all of these developments. It is quite innovative, coming in the form of an online account product known as FCMB e-Savings Account. Although there may be similar products in the banking market, like products from the stable of the bank, it comes with innovative and unique features.
Generally, the e-Savings Account provides a convenient and secure platform for potential customers of FCMB to open accounts online through the bank’s Facebook page and website. And its introduction is in line with the bank’s commitment to bringing traditional excellent banking services closer to all segments of the society and drive financial inclusion while enhancing customer experience via social media.
For instance, a potential e-customer has only to log on to the FCMB Facebook page, fill out some basic personal data and then upload his or her scanned valid passport photograph and signature mandate.
In terms of advantages, there are several with this latest product from FCMB and these include zero opening balance, zero minimum operating balance and minimal documentation requirements. While the account balances cannot exceed N200,000 single deposit and withdrawal transactions cannot also exceed N20,000, the bank said, “in addition to the above reduced KYC requirements, single deposits above the set maximum deposit and withdrawal limit of N20,000 and account balances above N200,000 would require additional KYC, which are valid ID card and residential address visitation. Thus, the customer is by extension, entitled to free access to online banking and free access to mobile banking.
Another strategic innovation in FCMB’s stable is tagged “Nairawise”. This has been designed out of the bank’s desire to support financial inclusion in the country. The product is tailored for the underbanked segment – artisans across the country and a couple of the very informal sector (middle and lower classes) of the society’s segments. The robust system is structured with ease for customers’ operation. The bank is taking Nairawise to the target customers in their various locations, adopting its agency banking model to reach the customers in far remote areas of the country to increase financial literacy and inclusion. The opening balance is N500; minimum operating balance is zero while monthly maintenance fee is also zero naira. With FCMB’s Nairawise, banking is simple, very easy and anybody can have an account.
An overview of the FCMB philosophy comes in handy. The bank which promises to offer simple products, be reliable and helpful also aspires to pride itself by its “extraordinary people and culture: a customer-focused and performance-driven environment.”
The Divisional Head, Retail at FCMB, Mr. Olu Akanmu, said, “our unique retail lending capacity enables us to offer valued services to millions of underserved Nigerians directly and indirectly, while supporting our portfolio diversification objectives to deliver sustainable growth. Our primary objective is to establish final inclusion and encourage savings among this segment of our customers through our value-adding solutions.”
Now that the bank has added other feathers with these products, expectations are high among the ranks of customers of yet another pacesetting innovation. And how well this expectation will be realised is dependent on how the bank’s sales workforce executes the product offerings in the stable.