Long queues move to ATM sites

By Kokumo Goodie, Lagos, Nigeria

His legs were in bandages. So was his face. He was assisted to the ATM point of one of the first generation banks in Egbeda, a sprawling residential area on the suburb of metropolitan Lagos.

Being a city prone to all manners of violent attacks, one would have mistaken the multiple injuries on his body for an armed robbery attack. Fifty-five year- old Ibrahim Al-Kazim (not real name)  was neither a victim of armed robbery attack nor that of a street fight. He is one of the millions of people that have suffered the consequences of the failure of the payment technology called ATM in Nigeria.

The previous week, he said had embarked on a business trip to Abeokuta, Ogun State. Business deal sealed, he entered his car and commenced his return journey to Lagos. When he got to Ifo, on the outskirts of the state capital, his car suddenly developed a fault. He was directed to a nearby mechanical workshop, where it was discovered that his alternator had problem and he was told N16,000 would take care of the problem. He had only N6,000 in cash but had his ATM card on him. He promptly dashed into the premises of a nearby bank.

“I was directed to a nearby ATM in Ifo. When I got there, the screen displayed: "sorry, temporarily out of service." Since I don’t live in that area, I became worried, especially as it was getting dark.  There was no other one around so another good Samaritan directed me to Sango. It was at that point that I boarded a bus going to Sango. When we got to Owode, the driver lost its control and ran into a stationary truck,” he said.

According to him, when the five occupants of the bus were rescued, they were taken to Ota General Hopital where they were attended to. “Pieces of the shattered windshield of the bus pierced my head and other body parts. The doctor had to carry out several minor operations to get them removed,” he said, adding that if the ATM he had gone to in Ota had worked, he probably not have been involved in the crash.

An Ireland-based businessman, Emmanuel Arionla, came to the country recently and was shocked by what ATM did to him. Encouraged by the success recorded by ongoing banking reform which he said he read online, especially the cash-less drive of the CBN, he converted the hard currencies on him into the naira, open an account and got an ATM card. He had to travel to Ilawe Ekiti, in Ekiti State for the final burial of his aged mother.  He took the little cash which will assure that he fueled his car and took along his ATM card. Getting to his destination and it was time to make available for the purchase of drinks and food, he went to the only ATM located in the city centre. When he got there, the machine could not dispense cash and his cash headache began.

“When I got to the ATM point, I inserted the card only to be told my financial institution was not available. I tried it again and I got the same response. I was frustrated and my cousin saw it on my face,” he said. He was advised to go to Ado Ekiti, the state capital, which is about 25 minutes’ drive away. On getting to Ado Ekiti, he got the same message and literally became a beggar. "I combed the city before I was able to make withdrawal," he recalled.

Customers are in Nigeria are increasingly finding it difficult to make use of their ATM cards. There is always an excuse for the inefficiency of the system. For them (customers), it is double jeopardy as going into the banking hall is dreaded just because of the long queues that is usually the hallmark of the banking halls. These queues are compounded by the absence of seats for the aged, sick and pregnant women to sit, so they have to join the line and wait "for their turn." Added to this is that most of the 'tellers' employed by the banks are on contract basis. Usually young ladies, they operate at speed of snail and could sometimes be cold to customers. So, the customers shelter in ATM becomes a natural elixir.

Ikotun Road, Egbeda parades about eight banks. Some of these banks have between four and six ATMs installed within their banking premises but the curious thing is that, it is only one of the ATMs that is usually loaded with cash. This leads to needless long queues at the only functional ATM, subjecting the customers to the vagaries of the elements.

Even customers that are prepared to pay the bank charges that go with on-counter withdrawals that falls within certain thresholds, have no incentives to do so because the banking halls, some with broken air conditioner (AC) units are usually over-crowded.

Another issue is that the ATMs are deployed mostly  in cities.. But this was not the case before the CBN rolled out a policy that culminated to the removal of all off-site ATMs in the country. Before then,  ATMs were ubiquitous across the country, especially at petrol stations, eateries and pubs.

Justifying the rationale for directing the banks to remove their ATMs from offsite locations, the CBN had said one of the policies guiding the operations of ATM consortium (ATMC) is that the ATMC shall have the sole mandate to deploy ATMs at public places while the banks shall deploy ATMs only within their premises.

The apex bank also said it observed with concern that the banks were competing with the ATMC in the deployment of ATMs in public places, adding that a worrisome trend is the number of ATMs at the airports and hotel lobbies, which if unchecked would soon, congest these public places.

It added that in line with the its policy on shared payments infrastructure by the banking industry and the need to effectively respond to the rising demand for ATM services by the public, the CBN decided to license an additional ATM consortium.

The apex bank has since swallowed its vomit by reversing the obnoxious order.  But Deputy Governor, Operations, CBN, Tunde Lemo disagrees.

 “There was no reversal. Recall that at the time, the CBN said banks should not put branded ATMs outside their banking premises in offsite, it was because then, when you get to some key locations like Hilton, you see 25 ATMs virtually every bank is there and yet other areas are not well served. "So, we felt that instead of wasting resources, why not get licensed Independent ATM Deployers (IADS) to have equipment there that will serve the entire industry. The IAD then were just three and so we had three in those important locations as opposed to having between 20 and 25 different machines, just to save cost. But recall that at that time, we didn’t have cashless programme, we decided to look away from that to encourage banks to invest heavily in ATMs. So, it was the cash-less programme that made it unnecessary to do that and of course, we have since ensured that they were compensated for the change in policy.” the deputy governor said.

Analysts say this is not the time for recriminations but a time to act in the interest of the customers. "What the CBN did then was bad. Banks had invested heavily to get these machines installed only for somebody to just come one day and reverse the fortunes of the banks. It is a classic case of policy reversals that have brought us to where we are as a nation. Now, the CBN wants the banks to go off-site but who will take that risk again? After the event, the fool is even wiser. Another CBN governor would come tomorrow and demolish the ATMs. Let the CBN provide the machines to enhance its cashless drive. The point of sale terminal (PoS) machines are also overwhelmed by network connection problem," a financial sector analyst said.

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