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Thursday, 28 February 2013

Nigerian Banks: Thieving, Illegal Charges & Unscrupulous Practices.



Has anyone noticed of recent that if you attempt withdrawing money from a First Bank ATM using an ATM Card of another bank that is NOT First Bank's, you would most likely get a responses like this "Incorrect PIN"; "Transaction Incomplete/Invalid" and others. I personally experienced this recently when I attempted withdrawing money using my Bank card on a First Bank ATM
. I also noticed that a couple of other persons who tried withdrawing using other bank cards had the same experience.

At first it seemed like a joke to me because I know that I could not have entered my ATM PIN wrongly three (3) times with a card I use very regularly and with my PIN that I'm so used to like the back of my hands! I'm not trying to discredit First Bank at all and bear no grudges with them, nor do I have anything to benefit from criticizing them. I also do not work for any bank nor am I an agent of any to avoid being misunderstood. I only wish to throw more light on an issue that I believe millions of Nigerians must have experienced at one time or another and may have sought answers, complained but never got anything positive done about it.

The part that got me utterly perplexed and wandering what exactly was going on was when I got to my bank and tried using that same ATM Card, and was told that I had exceeded the number of PIN tries. My card had been blocked! I was shocked! I asked one of the bank's staff why this had happened and narrated my experience and he told me in confidence that they had noticed this particular occurrence happening in recent times and with particularly First Bank ATMs. He also said that he suspects that they (First Bank) may have adjusted their machines in such a way that they reject other bank's cards and as such discourage customers of other banks from using their ATMs. I felt that such practice by any bank was unethical and should be sanctioned.

This is coming barely three (3) months after the Central Bank of Nigeria announced the removal of the N100 ATM withdrawal charges being charged by banks when customers of other banks use their ATMs. Personally, I was of the opinion that the N100 charge should not have been completely withdrawn, but rather minimized to a reasonable charge of say N5 or N10. I reason that the banks spend money to service and maintain their ATMs and they really do not owe customers of another bank the obligation to serve them for free! Infact, I believe they do have a certain leverage to charge customers of other banks a minimal fee for enjoying their service. Perhaps the bank was only just trying to avoid servicing non-customers to which they owe no service obligation by the sharp practice with the ATM Card rejection.

At the risk of being criticized for my opinion, I think it is better we are reasonable and realistic about what can and should be charged by banks-and by extension other service providers-for the services which they offer to us customers. This particular policy on the removal of the N100 ATM withdrawal charge is just one of several policy reforms by the Sanusi Lamido administration of the Central Bank of Nigeria in recent times, most of which have not gone down well with some Nigerians, the Banking community or both.

On analysis, a number of the reforms have helped to sanitize the nation's financial sector that was fraught with so much corruption as seen in the previous administration. So it becomes apparent that the objectives of these reforms are actually fundamentally sound. The challenge however is with the operators. How many times have we been changed for withdrawals that we did not really make-that is, the cash was not delivered by the ATM, but the account was debited. We are charged for SMS alerts and other forms of notifications. We are charged for things and transactions we are aware of as well as for those we are not aware of. We are charged legal as well as illegal deductions on our accounts which we sometimes complain about and sometimes ignore or do not even notice. Yet we still cling loyally to these banks and get shoddily served by them a lot of times.

It is not strange to turn the pages of the newspapers or other media and read of a Bank Manager, CEO or just a  Staff conniving and scheming to loot a customer/customers of millions and even billions of naira. And the question that usually pops in my mind is that "Are Nigerian Banks to be trusted?" With the introduction of the new Mobile Money platform and the increasing popularity of Internet Banking and other portable money transaction channels, I wonder, are we not more prone to thieving, illegal charges and unscrupulous practices by banks now than ever before? Will we not be at the mercy of thieving banks and bankers with these innovations coming on stream?

Pardon my bias, but I am yet to be comfortable with the Mobile Money platform. I feel its too insecure, could be easily hacked and that user information, including security information can be easily obtained/disclosed. Perhaps if effort can be made by both the CBN and the Banks to improve the security of these platforms as well as increase the confidence of customers, we would see these services being embraced more readily by customers even in the rural areas.

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