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  • Updated: March 03, 2023

Lingering Naira Crisis: Customers Deserting Banks For Fintechs

Lingering Naira Crisis: Customers Deserting Banks For Fintec

With the continued incapacity of commercial banks' digital platforms to deal with the unusual upsurge of transactional traffic occasioned by the lingering Naira crisis, customers have discovered better options in Fintechs and now patronize them in droves.

A sneak peek into the activities of bank customers reveals migrational shifts toward Fintech options like Opay, Palmpay, Kuda, etc.

This is very much a case of banks' misfortunes translating into Fintechs' fortunes.

The Naira redesign project brought a crisis that has made daily operations difficult for many individuals and organisations.

Thus, owing to a cash shortage in February, Nigeria’s economy almost collapsed, resulting in protests nationwide.

Later, to mitigate the side effects, the government reintroduced the old N200 notes into circulation, extending the deadline for their abolition by 60 days to April 10.

The attendant cash scarcity orchestrated by the naira redesign has caused conventional banks to struggle with the resulting pressure coming from Nigerians migrating to mobile and digital banking, leading to unanticipated stretches of banking platforms.

This ensuing pressure forced banks to close their doors to customers as they started protesting their inability to withdraw money.

With automated teller machines disabled and over-the-counter operations non-existent, banks’ digital platforms were overwhelmed.

Many bank customers were stranded as they were unable to conclude their transactions.

As a remedial measure to failing transactions, many banks escalated the transactional fault tickets by drafting more personnel to customer services to attend to customers’ complaints. 

Recall that banks were already having issues before the naira crisis, because several of them began losing their best hands to the ‘japa’ syndrome, a local parlance for checking out of the country.

Thus, the naira crisis has exposed the fact that there is now a general lack of qualified IT manpower in the banking sector, as many of them have emigrated to developed economies for a better life and greener pastures.

As things stand now, the banks may resort to bringing in expatriates at any cost to abate the embarrassing situation causing impatience amongst bank boards.

But not many people are so excited about Nigeria at the moment for obvious reasons.

The most reasonable is to see how they can poach bright guys to stabilize the system and consider younger talents that could be trained overtime.

According to the Vice President of the Nigerian Association of Small-Scale Industrialists, Seun Kuti-George, “Although the migration to online payment is possible, limitations from service glitches are matters of huge concern.

"What is worsening the situation is the technical issues accompanying the new means of payment, which is transfer.

“For example, I made a payment to someone in the morning and up till now, the fellow has not received the alert.

"So, I had to leave the goods there until tomorrow morning, hoping that the fellow would get alert by then.

"If it is an emergency or a matter of life and death or a matter of contract that will be cancelled, I would have lost that.

"But all these also will go away over time.”

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