By Yusuf Mohammed
Bank customers in the country are having hard time with some of the electronic transactions with no remedy in sight. This challenge has to do mainly with electronic money transfers and account debit without payments by the ATMs. Several customers narrated their ordeals with the banks and some of the stories are so pathetic especially those involving lost of lives and business opportunities.
While many Nigerians have embraced technology in their financial transactions, such as money transfer, mobile banking, and ATMs, however the introduction of technology which is meant to make business easier has become a source of heart ache. And this cuts across all the banks without exception.
In fact, transactions should be speedy with modern technology. For instance, many bank customers have embraced electronic banking for almost all banking transactions. Queuing in banking halls for hours has somewhat been reduced with technology.
While there is a significant improvement in how businesses are being done in Nigeria as a result of technology, there are some hitches. Timely reversal of fund transfers arising from failed transactions is something that Nigerian banks have not been able to achieve. Some customers told BusinessHallmark they have had delays for over two weeks waiting for the money to be delivered one way or the other – either to the destination or recipient or returned to the sender.
Customers are still experiencing delayed refund despite a new Central Bank of Nigeria (CBN) directive to banks to ensure quick reversal of funds. BusinessHallmark gathered that complaint of customers in this regard varies. Some are delayed for two to three weeks, some others, as long as six months. The banks blame this problem on technological glitches.
There have been many complaints of trapped funds due to network problems on online transactions. The problem does not just end at the money being trapped; getting a refund from the bank is the major headache for customers. This is very common with POS machine, one of the cashless policy instruments. Credit card or ATM card is used to make transactions not only in the banking hall but also in Hotels, supermarkets, boutiques, restaurants and bars.
Even those who pay for electricity sometimes use the POS. Sometimes these transactions fail without debiting the customer. That is bad enough. What is worse is that, at times, the transaction fails and debits the customer without the service provider receiving it. For instance, many of those who are in the business of recharging prepaid meter cards have stopped making use of the ATM card when they want to recharge their cards.
A young man at Adeniyi Jones, Ikeja who simply gave his name as Mark said “Before I used to load my account with enough money for the day’s business. Since they debit me without putting money in the card of my customers, I have stopped using my ATM card.”
When asked why, he said, “I have suffered in the hands of many banks. They would debit me and whenever I go there to complain they tell me in two weeks time that I would get my money. From two weeks, it gets to two months. Yes, they have paid me some but not all. As we speak, the bank still owes me some money.
In a similar vein, Clara who is into the same business says, “If you want to pay, just come with cash. I don’t deal with ATM. Even without using ATM, I still experience this problem. It is the customers that suffer because they would be the one to go to the banks to complain.”
Based on these complaints, CBN, in the a circular dated September 13, 2018, in exercise of the regulatory powers under Sections 2(d), 33 (1)b) and 47(2) of the CBN Act 2007 to promote sound financial system in Nigeria, issued some guidelines on Electronic Operation of Instant Electronic Funds Transfer Services in Nigeria.
The apex bank in the circular, with reference number: BPS/DIR/GEN/CIR/05/011, said the move is to “facilitate the development of an efficient and effective payments system in Nigeria.”
Financial institutions, among others, were directed to: “Refund into customer’s account full proceeds of failed transactions returned by the Receiving Entity within 10 minutes; “Refund into customer’s account full proceeds of transaction which the Sending Entity is unable to process within one (1) hour after the next settlement closure.”
As a penalty for default, the financial services regulator stated that “A failed NIP transaction not reversed into customer’s account within 24 hours based on complaints of sender and/or beneficiary attracts a penalty of N10,000.00 per item.” Many customers heaved a sigh of relief, but their hope was dashed. Things have not changed significantly since the CBN order as customers are still complaining of the same problem.
Ajaraonye Nwachukwu with Twitter handle @Chuks_Dee on 7th January 2019, took to twitter to complain of a debit of N15, 300 on his GTBank account after a failed POS transaction on 22nd December 2018.” At the time of filing this report, he had not responded to the question put across to him on Twitter to know if his money has been refunded by the bank.
Ejiro Otojareri who also banks with GTBank had a similar experience in March this year. He made use of the POS in a Supermarket and N1, 370 and was debited from his account. At that time, he was broke and it meant a lot to him. It took him three weeks to get it back.
A customer of First Bank of Nigeria, Bankole Adebanjo, with the twitter handle @iam_bankole1, complained bitterly of the bank’s refusal to refund his N6,739 that was debited from his account on December 25th 2018 after a failed transaction.
He tweeted: “FirstBank is too poor in terms of quick response to customers’ complaints. I used the Point of Sale (POS) to transact on 25th December 2018, and I was debited while the transaction was unsuccessful. I didn’t complain at that moment thinking the money would be reversed.
“Till date, I am yet to receive my money, and I have since reached out of them through twitter and email, but they keep telling the same story that my complaint is being passed to where it would be solved after taking them days to give me feedback.”
A customer of Ecobank, Mr. Micheal Adeyeye, with the twitter handle @Otunba_Babyface, said his account was debited when he tried to buy airtime using the bank’s mobile app. “This issue has been a recurring issue but I have often overlooked it since they are small amounts. I used the bank’s mobile app to buy airtime and the transaction failed.
“I tried again only to discover that I had been debited for the failed transaction, while the recipient only received airtime for one of the transactions; and up till this moment, I am yet to receive a refund for the failed transaction, neither has the recipient received the airtime debited.”
The Head, Complaints Management Division, CBN, Mr Tajudeen Ahmed, advised customers to draw the apex bank’s attention to unresolved transactions.
Ahmed advised customers with lingering problems with banks to contact the CBN by writing to the Director, Consumer Protection Department, or send an email to: firstname.lastname@example.org.
He also advised unhappy bank customers to visit any branch of the CBN closest to them to lay their complaints.
“The CBN continually engages the banks to find out if their conducts and practices are fair to their customers in order to stimulate people’s confidence in the banking system. Non-adherence to that normally results in regulatory sanctions as the case may be,” he said.
According to the CBN Governor Mr.Godwin Emefiele, the apex bank is committed to ensuring that the banking and finance sector is stable and conducive for both customers and operators.
“The Central Bank of Nigeria (CBN) in furtherance of its mandate to promote stable financial system, embarked on the development of a Consumer Complaint Management System (CCMS). This is an automated system aimed at easing complaints management to engender public confidence in the financial system.
“In view of this development, the CBN has made it compulsory for banks and other financial institutions to abide by three important guidelines,” he said.
The CBN advised banks and other financial services operators to ensure that they adhered to those stipulations, which became effective January 2, 2019, adding that failure to comply would attract sanctions in line with the Banks and Other Financial Institutions Act (BOFIA), Cap B3, LFN 2004.
Banks are quiet about this issue. Efforts to reach out to spokespersons of most of the banks with these challenges proved abortive as they ignored messages to their phones.
However, Mr.Oyeniyi Ajao, acting managing director, Nigerian Interbank Settlement System (NIBSS) had earlier this year blamed recent glitches experienced in POS transactions on the system upgrade to address the growing POS transactions, adding that normalcy will resume in the next couple of days.
He had stated that the value chain was long, and thus a failure from one of the numerous players would result in a failed transaction, he advised cardholders to take their complaints to their banks and use the correct complaint channel.
The acting MD had assured measures were place to ensure that transactions using POS do not fail, thus putting an end to the issues of transaction reversal.
Ajao said, “In 2018, we had 285 million POS transactions and that was the highest ever recorded in the country, in 2017, it was half of that, so, we are expecting that the figure will double in 2019 and that was why we embarked on an upgrade of our systems.
“A system glitch happened in the course of trying to upgrade capacity and at the same time other players in value chain had issues, Interswitch was having issues, the banks were having network problems too, and that compounded the problem in December. We started noticing the issues around December and the failure rate which was previously at 13 percent has climbed to around 16 percent,” he said.
Other excerpts from the meeting is the implementation of a secondary process whereby all reversals for any business day are re-transmitted between 10 pm and 12 midnight to return credit back to cardholders through their banks/Processors, which is to be effective from March 22, 2019.
Francis Wasa, the deputy director, Payment System Management Department of CBN also advised customers to forward their issues to the Consumer Protection Department of CBN.