LAGOS  – Business has been good for operators of digital banking platforms across the country as Nigerians endure the most trying financial system distortion ever due to cash scarcity experienced in the last two months and the failure of traditional banks to respond to online transactions.

There is no doubt that the cash redesign programme of the Central Bank of Nigeria (CBN) which saw old N500, N1000 notes being initially withdrawn from circulation while the newly printed new notes became insufficient to respond to the daily needs of users who rely on cash for their day-to-day activities has been a source of despair to many Nigerians.

Many analysts as well as the Central Bank of Nigeria (CBN) believe that the peri­od of the cash scarcity will boost the cashless policy of the CBN but the reverse has been the case as traditional banks has been unable to re­spond to the rise in demand for money transfers by Ni­gerians, thus leaving many businesses in comatose.

“As you can see, technolo­gy or lack of it has rendered the cashless policy of the CBN in a state of disrepute and banks have been failing their customers almost on a daily basis,” said Johnson Barde, an ex-banker and a businessman based in Abu­ja.

As banks were struggling to meet the demand and pressure of money transfer by Nigerians, many Nigeri­ans switched to mobile mon­ey operators or digital banks (fintechs) for transactions.

While the banking public face the double problem of naira note scarcity and elec­tronic transaction failures, some Nigerians are now turning to payment solution providers, like Opay, Palm­pay, Monie Point, among others, as a way out of the quagmire.

A lot of people have ex­perienced disappointments over transaction failures due to Nigeria Inter-Bank Set­tlement System Plc (NIBSS) system which has been crashing almost on a daily basis in the last two weeks, findings showed.

Electronic payment trans­action failure includes PoS debit errors, card rejection, and PoS network glitches.

As of 2019, the failure rate of the transactions on PoS stood at 15.68 per cent. NIBSS recorded 137,132 fail­ure rates, for just one day, ac­cording to data from NIBSS.

Lamentations

Some Nigerians have lamented their experience of unsuccessful cashless transactions due to failed mobile networks amid the biting scarcity of Naira notes.

They recounted that after several days or weeks, some of the mobile bank transac­tions for payments were yet to be delivered and the affect­ed banks had not reverted the debit transaction.

Some Nigerians who have experienced transaction fail­ures spoke to Sunday Inde­pendent.

“I transferred N3,000 with my GTBank account to Ac­cess Bank, last two weeks, and up till now the person has not received it and it has not been reversed,” said an artisan who identified him­self as Johnson.

Another customer said his N80,000, which he trans­ferred to another customer, is still hanging for the past one week.

Mrs Idowu Samuel, a trader in Ogba area of Lagos, told Sunday Inde­pendent how she had been having difficulty using the mobile banking cashless payment modes in his line of business.

“As I am speaking to you, I have two unsuccessful trans­actions still hanging. A cus­tomer transferred N44,000 to my OPay account from GT­bank but for two days I have not received the alerts and I also did a transfer of N10,000 to a customer of mine who was to deliver goods to me the following day with my Zenith Bank account to his Stanbic Bank Account for more than two weeks now without success.”

Moses Akinlawon, anoth­er trader in Ikeja, said that despite traditional banks’ incompetence some mo­bile money operators have stepped up to the task.

“I made an instant trans­fer to a bread vendor using an Opay account, it’s the fastest transfer I have done recently. I have been able to send money to my workers through PoS guys that use Opay, and they get it instant­ly. I’m thinking of opening an Opay account myself.”

Olatide Olayinka, a stu­dent at the University of Lagos said: “I was trying to transfer money to people during the weekend using my bank app and USSD and I couldn’t.

“I asked my brother to help transfer using his Opay account and he was able to make the transfers immedi­ately.”

Furthermore, as the cost of living crisis escalates with the new naira notes scarcity across the country, many Nigerian students have resolved to use mobile banking to effect transac­tions on campus.

The continued scarcity of naira notes across the coun­try is crippling businesses and social life on campus, especially among students which have resulted into protests from some univer­sities such as University of Benin and University of Ibadan.

Ndigwe Ifeanyi, a law student at Babcock Univer­sity, Ilishan-Remo, in Ogun State, told Sunday Inde­pendent that the new naira notes initially came with a lot of optimism but that the students are disillusioned with the outcome of events in recent time whereby they rely only on mobile banking to transact.

“Students now have to rely solely on mobile bank transfers on our phones with deductions from the banks for every transfer made.

“Those of us that have the old notes aren’t finding it easy to deposit them in the bank.

“The PoS vendors are really living the life as a withdrawal of N5,000 at­tracts a charge of not less than N1,000 which is very discouraging,” he said.

Ndigwe stated that the use of transfers on students’ smartphones is the most convenient way so far.

This, according to him, is because the banks at the university’s annex campus were not dispensing the new notes but the main campus has active banks that should be dispensing the new naira notes.

Deposit money banks have taken additional mea­sures to quicken the flow of naira notes. These measures, among others, include de­ployment of extra technical supports for online payments, additional security at ATMs to ensure all-clock usage, technological back-up to re­duce online downtime to the barest minimum, additional staff deployment to counters to attend to cash transactions and timely interbank and inter-branch networking to bridge any gap.

Similarly, another stu­dent, Ifunanya, from the mass communication department of Babcock University, said the naira scarcity is affecting her so much that she cannot even go to the banks to make any transactions or withdrawal because of the number of people there.

“I cannot buy data or send money because of the bad network of Zenith Bank. The new currency is not in circulation and I cannot use the old one because of it be­ing rejected here. So, I have to use my card, and in using my card, the banks charge extra.

“PoS vendors are charging N200 for every N1000 transaction, and it’s so crazy. This has made me stop withdrawing money,” she said.

Responding to these com­plaints, Godwin Emefiele, governor of the CBN, said: “We are mindful of the chal­lenges some citizens have faced and are addressing them.”

He noted that there have been reports of occasional failures in e – channel plat­forms.

“Our monitoring suggests that whilst there has been an expected surge in electronic transactions, these have not risen to unprecedented lev­els and the payment system is well equipped to handle even higher transaction vol­umes,” Emefiele said.

He added that whilst transaction failures are bound to occasionally occur, the public is encouraged to have full confidence in Nige­ria’s globally recognised pay­ment system infrastructure.

Banks have also been instructed to ensure 24/7 service availability and to promptly address any cus­tomer refund request arising from such service failures.