- CBN blames banks for inactivity of devices
The Nigerian banking public, especially the subscribers of Point of Sales devices, have lost faith in the cashless policy of the Central Bank of Nigeria.
In spite of the incentives offered by the CBN in collaboration with the Nigeria Inter-Bank Settlement System, traders, shop owners and other users of the POS have become frustrated as a result of the challenges they have been experiencing using the device.
They alleged that the initiative had failed, stating that this explains why the apex bank had not continued its campaign in other states across the country.
The purpose of the cashless policy, which was introduced by the CBN in April, 2011, was to reduce the volume of cash in circulation across the country. The idea was to allow the banking public to use their Automated Teller Machine cards to make payments for goods and services instead of carrying cash around.
The pilot scheme was launched in Lagos in January, 2012 and replicated in Port Harcourt, Rivers, Kano, Abia, Anambra States and Abuja in July, 2013.
But some of the POS subscribers, who spoke with The Point, narrated their ordeals, insisting that the negligence of the apex bank was responsible for the incessant cases of double deductions from depositors’ accounts and poor internet services.
A director, Dunamis Boutique, Ilupeju, Lagos, Mrs. Nkechi Ofodile, explained that the device had made the operations of the outfit inefficient, which had affected its customer base. According to her, seven out of every 10 POS used in the store had been ineffective and dormant.
“It was so frustrating that we have to dump them. Bank officials have not come to service them since we made the complaints and that had forced us to go back to cash-based transactions.
This had made lots of our customers to look elsewhere too.
“Sometimes, we had to escort them to a bank close by to make withdrawals to pay for items. The only good thing is that no charges would be deducted from cash transactions unlike the POS. So, I am not even bothered about the POS, especially when I think of the charges,” she said.
For the chief executive officer, Heritage Supermarkets, Ikeja, Lagos, Mr. Odeyemi Akinola, the dormancy of the machines indicates that the initiative is another incident of policy summersault witnessed in the country.
He alleged that since the Godwin Emefiele-led CBN took over from the immediate past governor of the bank, Lamido Sanusi, who introduced the policy, nothing had been done about ensuring the spread of the policy to other states.
“Though, the CBN had not come out to announce the suspension of the policy but from all indications, there are signs that there has been no continuity since the new leadership at the apex bank took over. Also, there has been no mechanism in place to monitor the performance of the devices either by the apex bank or the deposit banks. “The POS machines in our custody are dormant and this is because of network issues, which hinder sales, especially after a heavy rainfall. Some clients don’t come back, unless they urgently want any of our items. Network is still an issue because if we are talking about cashless policy, the banks and network service providers have to be on top of their game,” he disclosed.
However, the plight of the Managing Director of Showlad oil and gas, (a franchisee of Total filling station, Wuse, Abuja), Alhaji Ahmed Abubakar, might be different from others mentioned above, it does not change the fact that the policy is trying to keep its head above waters.
Contrary to the directive of the CBN that all banks should install a device that would automatically reverse failed transactions, Alh. Abubakar disclosed that his banks have not complied and that had embarrassed his station countless times.
“We stopped using POS after several customers complained bitterly about double deductions, which is connected to the inability of the machines to reverse failed transaction that was later deducted from the customers’ account. It had embarrassed us countless times and scared some of our customers. The fault is not entirely the banks,’ the CBN ought to monitor the compliance of its directive or introduce a platform for complaints to be lodged,” he lamented.
POS will soon be active – NIBSS
Confirming the dormant and ineffectiveness of the POS machines in circulation, the Director, Business, NIBSS, Mrs. Christabel Onyejekwe, told The Point that about 50 per cent of POS machines acquired by the Deposit Money Banks, given to merchants and business outfits operating in the country, had become dormant and faulty.
She explained that out of a total of 120,000 POS machines in the country, only 62,000 were active, while a total of 100,000 terminals were already registered with the company.
She said that the NIBSS was constantly in discussion with banks to get the 58,000 dormant POS devices active.
“Electronic payments have been growing significantly in Nigeria and this is really encouraging. In December 2015, we recorded 18 million transactions for that month alone. This is significant because 15 million transactions used to be the highest. Growth in e-payment is interesting. For POS, we have grown from just 5000 active POS terminals in 2012 to 62,000 currently and this is very significant,” Onyejekwe said.
She noted that in February and March 2016, the transaction values were N46.14 billion and N51.96 billion respectively, adding that the values this year have been higher when compared with the value of monthly transactions recorded in the first four months of 2015.
Cashless policy is on and compliance is increasing – CBN.
However, the Assistant Director, Banking and Payment Systems Department, CBN, Mr. Sola Agboola, he disclosed that the e-payment system adopted since 2011 was still on and that the adoption rate would continue to rise.
“The CBN is doing all it could to boost customers’ confidence and enhance the use of e-payment channels. The apex bank had sanctioned four banks for failing to install auto reversal device on their terminals.
“We discovered that many banks had customers’ money hanging in their books as a result of dispense error. We issued a circular and gave them an ultimatum that they should install a device that would automate reversal of transactions. A situation where customers have problems, and go to complain and the bank will not attend to them can no longer continue. When we carried out our oversight function to ensure banks had complied, four banks were penalised last year. And since then, things have changed,” he said.