On banks, customers and COVID-19

Globally, banks occupy a primal locale in the annals of commerce and business. They are portrayed in some quarters as one of the engines that propel the wheels of economic progression. They may be the exact provenance of joy to the business entities, households and even governments.

Sometimes, they may append boundless values, sweeteners and flavours to households, businesses and even to nation-states. They are usually seen as the interposers between the credit and deficit units of the economic strata. With a pertinacious resistance to interruptions, they play that noble role by accepting deposits from the surplus units and lending the same to the deficit units. In the execution of this onerous task, they are seen as wealth creators.

In some jurisdictions, they have ascribed the sobriquet of fortune builders or makers. Additionally, through their positive and aggressive interventionism, they may turnaround the fortune of a penniless being into that of a billionaire: no thanks to the fact that the client, parades merely a bankable idea, despite the lack of financial muscle or wherewithal. This, therefore, willy-nilly coheres with the saying of the wise that: “ideas rule the world.”

Where the pendulum swings really matter a lot. If you or your business entity is highly favoured by the business climate, induced by either a force majeure or via regulatory action or inaction, or even an amalgam of all, your guess is as good as mine. Look at the goodies that COVID-19 has conferred on e-commerce or online businesses. See the fortunes that the pandemic has unleashed or better still, foisted on pharmaceuticals, food vendors, couturiers and confectioners. Expectedly, this may deepen the fraternity between the banks and their customers that are in this market segment.

Contrariwise, imagine the traumatic pains, that the pandemic has fobbed off on some businesses such as music, entertainment, hospitality, tourism, airlines et al. Indeed, according to the Minister of Aviation, Hadi Sirika, the “aviation sector alone, has been losing about N21 billion monthly since the outbreak of COVID-19 in the country.” The Minister disclosed this at the daily Presidential Task Force on COVID-19 briefing on Wednesday this week.

Viewed against the backdrop of the above, the sound bites on the socio-economic terrain may be akin to a trade-off of some sort, wherein the gains of the former group are literally the losses of the latter. Put poignantly, as at the last count, and according to analysts, it was estimated that the losses in all sectors of the Nigerian economy were so humongous that they could pass for several billions of Naira.

As a rational analyst, one needs to empathise with the Nigerian banks owing to the fact that they are faced with a lot of challenges and have not been able to meet fully the demands of their customers since the outbreak of the deadly COVID-19. Prior to the lockdown, some of the bank charges were reduced which equally might shrink their bottom line going forward.

As good corporate entities that would not want to run foul of the laws of the land, banks were unable to open fully their doors to customers during the lockdown but the online banking services were not only in full throttle but, visibly uninterrupted(?).

Furthermore, while the lockdown lasted, the Automated Teller Machines (ATMs) became the darling of those who were desirous of withdrawing cash. The customers had no choice than to stick tenaciously to this medium. Also, one must equally commend the efforts of the Mobile Money Agents/Operators and some merchants who activated and infused life into their hitherto moribund PoS/cash-back operations as veritable tools for cash withdrawals.

Consistent with good corporate governance, coupled with the social responsibility of the Nigerian banks, they responded swiftly to the clarion call to lift the nation from the pangs of the pandemic. It is on record that the banking community was one of the leaders in the private sector initiative via CA-COVID to complement the efforts of the federal and state governments in order to relive the Nigerian citizens of the burden of the pandemic. As at the last count, the banking industry plus the likes of high net-worth individuals such as Dangote, Adenuga, Otedola, Rabiu, Alakija etc, were able to pool together a whooping sum of over N27 billion to give some bite into stemming the tide of the pandemic. Under the headship of the Governor of the Central Bank of Nigeria, the bankers and other stakeholders were able to put up an isolation centre in Lagos, and more were being expected across the country. There is an ongoing feeding programme for some of the less privileged and vulnerable Nigerians.

On the downside, if care is not taken, all the gains of these laudable efforts may be frittered away, unless and until the banks are mindful of the need to respond quickly to the plight of their numerous stakeholders. If decisive actions are not taken by the banks to extinguish the gull between the banking halls and their customers, it will be on record that the banking industry is vicariously liable for fanning the embers of the exponential upsurge of the pandemic. And if the accusation being levelled against China by the US and its allies that the former was the progenitor of the pandemic is anything to go by, then, the banking industry will have some Herculean task in convincing the citizenry not think the same way if the sheep are down.

The good news? As things are now, the banks still have a second chance in order to emend the wrongs of the past few weeks. Like Robert Kiyosaki once opined in his book titled: Second Chance: “Sometimes you have to let go of what you love doing so you can do what you are supposed to do.” Within this context, the banks and other stakeholders including but not limited to the National Orientation Agency, should make some sacrifices in the interest of the nation at this time. In doing this, however, they need to embark on aggressive enlightenment campaigns for their customers to use other channels to transact their banking businesses: Electronic banking should be massively used now and even post COVID-19.

Additionally, CA-COVID should be magnanimous at this time to deploy some of its resources to better a lot of Nigerians that are staying off the banks’ premises. For instance, it was so disheartening to see that most of the ATM machines had no hand sanitizers, no security operatives to enforce social or physical distancing and the rest. It was also noticed that many of the ATM machines did not dispense cash to customers. These are flashpoints that should be thoroughly examined and appropriate solutions proffered.

By the same token, the banking industry should embark on some devolution of power to their TRUTED mobile money agents across the length and breadth of the country to handle and process some basic banking activities like enquiries, complaints etc that could keep hundreds of customers off the banking halls. The Telecoms industry has imbibed this culture and the success story is there for all to see: their agents now register SIM cards, among other ancillary services.

At this juncture, it is apt to commend the bold steps taken by the Bankers Committee to nip in the bud the dark cloud of unemployment that was already hovering over the heads of the banks’ employees despite their innocence in the emergence of COVID-19 in Nigeria. Inherent in the prepossessing features of their decision was that: “in order to help minimize and mitigate the negative impact of the COVID-19 pandemic on families and livelihoods, no bank in Nigeria shall retrench or lay-off any staff of any cadre (including full-time and part-time).”

This is exceedingly salutary because the courageous move of the Bankers Committee in pausing the massive retrenchment has extirpated the unintended consequences that the massive retrenchment of bank workers would have caused the entire nation. Aside from sending wrong signals to the entire world in general and the Nigerian state in particular, the massive retrenchment would have given other employers of labour within the Nigerian state the vigour to key into this unpleasantness. This would have been incongruous with the mood of the nation at this time. Put starkly, it would have cast grave doubt on the realism of any endearment in the interactions between the banks and their avowed stakeholders.

Dr. Adaramewa, a lawyer and ex-banker, wrote from Lagos.