CBN to move against banks over poor services

• Urges public to reject inefficiency
• ‘Delay in funds transfer, system failure not acceptable’

The Central Bank of Nigeria (CBN) has warned the nation’s banks against poor services, asking them to shape up or close shop.The caution followed a series of complaints by customers of frustrations in completing their transactions at various branches or at Automotive Teller Machines (ATMs), most associated with system failures or poor network connectivity.

The Director of Banking and Payment System Department of the CBN, Dipo Fatokun, threatened to sanction any bank found wanting. He urged the public not to withhold such complaints, but speak out against inefficiencies.

Refusing to condone the excuse of system failures, Fatokun told The Guardian in a conversation: “Yes, there could be system issues, but it should be the exception and not the norm.”

As it is, the banking industry operations may soon be laden with the challenges of either malfunctioning of core banking software, inadequacy of the software, lack of trained personnel to operate them or negligence. This is because customers are increasingly turned down from updating their accounts except they go to the branch of domicile, on the grounds that it cannot be done through the unified core banking system. In other instances, funds transfers from one account to another, even within the same bank, are not completed, and may take up to one month or more, depending on the level of efficiency of the banks to return the funds to the owner’s account.

Reacting to the development, the CBN described such inefficiencies as unacceptable. With regard to money transfers, Fatokun said it was one of the simplest banking transactions. “After six minutes, the receiving account should be credited, if not, the bank should give a reason. Also the refund in the event of uncompleted transaction for one reason or another, should also take minutes not weeks or months.”

The developments, observed in major banks’ branches, have raised concerns over the availability of skilled personnel to carry out the operations, given the recent downsizing in the industry.

The situation has also raised questions over the functionality of the deployed banking software, as well as the validity of several claims by the operators of acquisition of sophisticated software aimed at ensuring the efficiency of the unified banking system.

Specifically, these banks were not able to update customers’ accounts that were previously opened in another branch as they failed to access the details. Officials of these banks claim it can only be done at the branch of domicile, a situation that appears strange given the level of the country’s payments system.

A customer of one of the top five banks, after going through the process of updating her account which lasted for more than one hour, was finally referred back to the branch of domicile.

Another customer confided in The Guardian that he too was referred to his branch where the account was opened in Kaduna, even as the account continues to hold on to huge cash as well as receive lodgements.

The CBN described such development as contrary to the modern banking industry.According to Fatokun, as long as there is no network failure, every account in a bank can be accessed from any of the same bank’s branch, which is the reason people make transactions across the country.

“It is not acceptable and no bank should give such an excuse. It is a setback to the progress recorded in our payment system. Please report such bank and branch to CBN for necessary action,” he said.

The ordeals of two customers from two different banks caused further inquest by The Guardian, which led to the discovery of similar complaints by customers from other banks.

Reiterating the importance of knowledge in the effective discharge of duties, Fatokun urged banks to train their personnel further in their specific areas of operations to stem inefficiencies.

The dilemma remains whether the situation is a matter of one branch integration challenge or a fast-spreading problem that may soon take the industry by surprise.