Nigeria’s ATM nightmare

If you are one of those account holders in Nigeria, here’s one piece of news that should get you thinking. Banks have withdrawn about 20 million ATM cards to reduce fraud associated with them.

I have always known that there was something queer about forcing an illiterate population to accept the use of ATMs (automated teller machines).

In less than three years of the ATM, over 90 percent of Nigerian banks were networked to allow customers to access their accounts from any cash-point irrespective of which bank owned the ATM, and banks were recording subscription in excess of 10 million to ATM cards. I thought that was queer for a largely illiterate banking population that has always been comfortable with ‘mortar and brick’ banking.

I also thought it was strange for people who are yet to understand the nuances of electronic banking to accept wholeheartedly the idea of using ‘passwords’ to make cash withdrawal from a machine that was as impersonal as it was unconcerned about who was watching you as you remove your cash from its bowels.

I started having a good understanding of Nigeria’s ATM galloping growth when it occurred to me one quiet morning while in the office in Lagos that I have three ATM cards for my three different banks' checking accounts.

It also occurred to me that I had failed to do diligent appraisal of my financial standing before I opened the three personal checking accounts. Like many Nigerians, I had fallen victim to the rapacious antics of banks' marketing executives who would do anything to have you open a checking account with their specific bank.

I had not only become a man with scattered accounts amounting to nothing significant because of the sheer folly of spreading a resource that could carry weight in one single account; I had also become vulnerable to the growing incidence of disappearing cash that never got dispensed after I had pressed the necessary buttons to have the amount dispensed at ATMs.

On one occasion, I had cause to complain to one of the banks that a deduction had been made from my account for cash that the ATM never dispensed. I was told it would be rectified. It never got rectified. Because the amount was less than $50 and I had to travel out of the country two days later, I never pursued the matter to a conclusive end.

I had to reconsider my folly when I listened to the testimonies of some ‘scammed’ Nigerians on a radio program in Abuja. They had lost different amount to ATMs that failed to dispense the requested cash. The banks had failed to address their complaints satisfactorily and they had simply been ‘scammed’ by the ATMs; by extension the banks. I made a quick calculation and realized that millions of dollars were ending up wrongly in banks’ vaults as a result of customers failing to get their requested cash from ATMs.

If banks have been getting away with this in the last three years, they have probably earned a whopping fortune illegitimately, and they must be investigated to straighten things out in Nigeria’s ATM nightmare.

The ATM has brought as much joy to the upwardly mobile as it has brought sorrow to millions of ‘e-illiterates.’ While the few upwardly mobile could afford to straighten things out with banks, if they could spare the time, the largely illiterates have remained pawns in banks’ ATM misadventure.

ATM subscription has grown not by persuasion but by coercion. Banks simply put your names on the ATM card request list without your asking them. They then issue the cards and advise you use the ATM to avoid the queues and delays in the banking halls.

Without any regard for the literacy level of many of their customers, they simply migrate millions of account holders to ATM card holders through subtle coercion. And they provide little or no education to enable these users to learn the basic rules of using ATM cards.

The results? Millions of ATM users simply ask private security guards at the banks to help them operate the machine. To total strangers, they give their passwords with expressed permission to access their accounts' details and assist in pressing the necessary buttons to make the ‘queer’ machine dispense cash.

Because of the untidy nature in which the ATM was introduced into Nigeria’s financial market of 24 banks, the inviolability of the system has been heavily compromised. And the banks have to carry the full weight of the blame. They made a mess of a good initiative to prove their e-readiness - and, perhaps, to earn illegitimate profits.