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  • Tech - News - Tech Companies
  • Updated: February 21, 2023

Naira Scarcity: Why Banks Are To Blame

Naira Scarcity: Why Banks Are To Blame

If truth be told about ongoing fallouts of the naira swap policy, records will vindicate the Central Bank of Nigeria and the Federal Government for proactive campaigns they put out three to four months in advance for the commercial banks and their customers to return old Naira notes in exchange for the new ones.

Indeed, both the commercial banks and their customers were not proactive enough to envisage the last-minute escalation beyond what is manageable.

At the time of this report, almost all the banks are guilty of either failed or frustratingly slow e-transfers.

The reason is simple: the much-needed capacity expansion for accommodating traffic overloads has not been factored in by the commercial banks.

What is noticed is the experience of Nigerians helplessly struggling with the popular USSD codes such as *966#; *894#; *737#; #*919#; *711#.

Naturally, more Nigerians have lately taken to the option of electronic payment channels because of the acute shortages in cash circulating in the economy. 

The consequence is unusual traffic congestion and latency interfering with the efficiency of e-transfers. 

It is for this reason that financial institutions have been advised to strengthen their e-payment platforms.

The advice was made over the weekend by PPC Limited, Nigeria’s lCT and Infrastructure Development Company.

While speaking on the impact of redesigned naira notes on banking infrastructure, the​ Director of Operations and ​Head of the ICT Division at PPC, Dr Patrick Ede, observed that the inadequacy of the e-payment channels to withstand the deluge of transactions​ orchestrated by the surge in the use of such channels for payment is causing many failed and unsuccessful ​transactions.

What the Banks Need to Do

At the behest of accusations and counter-accusations between the banks and the telcos following the Naira swap imbroglio, it was flagged on this medium for banks to look inwardly at what they must do to mitigate current hardships suffered by consumers.

In line with the expressed position on this platform, Ede further said, “To alleviate the congestion on payment channels, banks should carry out an audit of payment channels to identify gaps and loopholes in the system with a view to phased resolution.

"This first step will ensure that banks raise the standards of experiences they provide to customers and ensure that customers remain at the center of their business models.”

Again, we cannot agree less with Dr Ede regarding his submissions above.

The banks are not guiltless in this issue.

The latest frustration in the land coupled with the allegation of banks doing brisk business with new Naira notes further confirms that the banks and their managers are not being proactive enough.

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