In a major stride toward a technology-driven future, FirstBank, the West African premier financial institution and financial inclusion services provider. has launched a new FirstBank Digital Xperience Centre (DXC) in Area 10, Abuja, reaffirming its ambition to become Nigeria’s most digitally advanced financial institution.
The Group CEO, Olusegun Alebiosu said the Centre exemplifies the bank’s digital-first strategy, blending automation, self-service, and cybersecurity to redefine customer engagement.
The Governor of the Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso, has reiterated the Bank’s commitment to restoring macroeconomic stability, strengthening the banking sector, and positioning Nigeria as a leading investment destination.
Speaking at a fireside chat with Andreas Voss, Chief Country Representative of Deutsche Bank Nigeria, during the European Business Chamber (Eurocham Nigeria) C-Level Forum in Lagos on Saturday, September 6, 2025, Cardoso said the ongoing bank recapitalisation exercise is “making good progress” and will produce stronger institutions capable of withstanding shocks and financing growth.
For years, USSD (Unstructured Supplementary Service Data) banking in Nigeria has been a lifeline for millions of Nigerians. It was simple, fast, and accessible even on the most basic mobile phones. From transferring money to paying bills, and checking balances to buying airtime, USSD provided seamless access to banking without the need for internet access.
But now, a terse, polite message from banks may have sounded the death knell of the service. In what feels like a final move in a long-standing tussle between telecom service providers and banks, the new directive from the Nigerian Communications Commission (NCC) mandates that going forward, USSD banking charges will be deducted directly from customers’ airtime, not their bank accounts.
Through a legacy of excellence and Innovation, First Bank of Nigeria Limited, the country’s oldest and most distinguished financial institution, has once again solidified its reputation as a leader in the banking industry.
The Bank was recently crowned the Best SME Bank in Nigeria and the Best SME Bank in Africa at the 2025 Asian Bankers Awards for the second year running. The Asian Banker Global Excellence in Retail Finance Awards are renowned for their rigour, prestige and transparency, celebrating excellence across financial services, technology, risk management and transaction finance.
These prestigious recognitions reaffirm FirstBank’s unwavering commitment to Small and Medium Enterprises (SMEs), a sector that serves as the backbone of Nigeria’s and Africa’s economy. For over a century, First Bank of Nigeria Limited has been instrumental in the nation’s financial evolution, pioneering innovative banking solutions and fostering economic growth.
Public institutions in Nigeria have a knack for policy inconsistency. They can aggressively pursue a course of action one moment and, the very next, introduce measures that directly contradict their stated objectives. The Central Bank of Nigeria (CBN) is currently at the centre of one such paradox.
Everyone alive in the last couple of years witnessed the CBN champion financial inclusion, digital banking and cashless transactions. It actively encouraged banks to expand their digital footprint, increase adoption of digital payments and decongest the banking halls. Nigerians responded positively. People embraced digital banking, relying on ATMs, mobile transfers and POS terminals instead of entering the banking halls.
The Nigerian banking system, once celebrated as the backbone of the nation's economy, is facing a glaring paradox. Customers walk into bank branches daily to access their funds, only to be told that cash is scarce. The situation, which began following the Naira redesign exercise under former President Muhammadu Buhari, has become a troubling norm. Bank tellers now ration cash withdrawals, often imposing arbitrary limits like N20,000 per person, without detailed explanations. This raises an unsettling question: is there a hidden liquidity crisis in the Nigerian banking system?
The central function of a bank is to provide customers with seamless access to their deposits, yet this appears to be failing. The scarcity of cash at bank branches stands in sharp contrast to the availability of cash through Point of Sale (POS) operators, who always seem to have more than enough to meet demand. This discrepancy is baffling and has fueled widespread speculation about the health of the banking system.
The Chartered Institute of Bankers of Nigeria (CIBN) in partnership with Digital Jewels Africa (DJA), a leading IT Governance, Risk, and Compliance (GRC) firm, organized a high-impact workshop for the banking sector, reports ITREALMS.
The workshop themed “A Cyber Resilience Table Top Simulation Exercise for Board Members and Executive Management of Banks,” aimed to tackle the increasing cybersecurity challenges in Nigeria's banking industry. It equipped senior executives and board members with effective tools and strategies to combat evolving cyber threats.
The Governor of the Central Bank of Nigeria (CBN), Mr. Olayemi Cardoso, has said that the Bank’s decision to implement the Electronic Foreign Exchange Matching System (EFEMS) is rooted in the understanding that trust is essential to central banking, reports ITREALMS.
Addressing members of the Harvard Club of Nigeria in Lagos at the weekend on the topic: “Leadership in Challenging Times: Restoring Credibility, Building Trust, and Containing Inflation,” Mr. Cardoso reiterated that the CBN’s move was to enhance transparency and provide more accurate oversight of foreign exchange transactions.
Innovantics Limited, end-to-end custom-built software solutions provider, has won the best biometric banking solutions of the year award at this year’s Africa Beacon of ICT (ABoICT) Awards held recently in Lagos.
The biometric banking solutions was implemented by Innovantics for UBA, Africa’s pan-African bank to solve difficult business problems.
With over 4.6 trillion-naira loans to customers in Q3 2023, FirstBank is committed to economic growth and transformation says the Group Managing Director of FirstBank of Nigeria Limited, the premier bank in Africa, Dr. Sola Adeduntan, in this interview with Festus Akanbi in readiness for the 2024 journey.
The global community is yet to recover from the hostilities in Eastern Europe and the Middle East and the wars do not look as if they will end soon. How can Nigeria, a leading producer of oil, take advantage of the attendant disruptions to world order to reposition its economy instead of continuing to count the losses of the wars?
Leading Africa-focused fintech platform, the Palmpay, has said that the future of money is now; therefore, the company has put in place adequate infrastructure, and the right measures to ensure that its millions of customers are guaranteed adequate security.
Speaking while making a presentation titled “Future of Money, Security, Customer Experience (CX)” at the Africa Tech Alliance (AfriTECH 3.0) held at The Providence Hotel, Ikeja GRA, last week, Mr. Chika Nwosu, the Managing Director of PalmPay, said that besides the operator putting the right things in place, the consumers also must the aware of how to protect themselves.
The story of corporate Nigeria in 2022, cannot be complete without a chapter on the incredible performance of First Bank of Nigeria Limited, which saw the hitherto encumbered bank now returning to the top of the ladder of the Nigerian banking industry, amid a harvest of international laurels, writes FESTUS AKANBI.
By December this year, Nigerian quoted companies will begin to upload their full year 2022 results in compliance with the dictates of the principle of disclosures to regulators, investors and customers as enshrined in the act of Corporate Governance.
Having enjoyed centuries of monopoly, assured by the support of regulation, including through stringent requirements to new licensees, the erstwhile secured future of traditional banks is facing a heightened threat of disruption from Financial Technology companies (or FINTECHs), who are exploiting pent-up customer dissatisfaction and new technologies such as blockchain, coupled with the significant boost in smartphone adoption and pervasive broadband to disrupt the sector. The foundation of the Fintechs’ disruptive model lies in a peer-to-peer model for transactions, without any middleman or Central Authority in mind. A model that will possibly render the current establishment totally redundant and irrelevant. The biggest threat to the banks has been precisely their seeming success. Centuries of relatively significant higher returns, even in the midst of economic downturns that adversely affect the real sectors, has engendered an attitude of invincibility and pomposity, characterised by a loss of touch with their customers. Considered too big to fail, they take it for granted that they will be bailed out with taxpayers’ money in the event of any missteps – a perfect prey for disruption. There are indeed five forces that will define the new face of banking: 1. The banks - traditional and established, best with cash and ancillary instruments 2. Fintechs – the new kid on the block, disrupter, mostly telecom roots, best with digital currencies and mobile services 3. Regulators - Central Banks, regulating traditional banks; and Communication Commissions, responsible for telecoms regulation (and thus Fintechs) 4. Currencies - traditional, such as cash and cheques; or Digital, such as bitcoin or other cryptocurrencies 5. Customers - the weight and force of their new found voice. Typically, they clamour for whatever will give them convenience and lower costs. These forces and their interplay are represented in the schematic below: A schematic representation of Austin's five forces analysis of the future of banking. Customers are the most significant force, and represented by the outermost sector of the concentric circles. As they tend more towards a preference for digital currencies, the Fintechs will tend to assume a more prominent role in the new face of banking, and the Regulatory regime will inadvertently tend towards the Communication Commissions under whose purview the Fintechs fall. This will introduce a regulatory imbroglio, as future ‘Huge Banks’ may fall outside the regulatory ambit of Central Banks (as seems to be the case with the MPESA mobile money platform, through which 25million Kenyans transacted $28billion in 2015, representing about 44% of the country’s GDP. Safaricom, the telecoms promoter of MPESA ironically falls under the regulation of the Communications Authority of Kenya rather than the Kenyan Central Bank). If the customers however, maintain a strong appetite for traditional instruments of financial transactions such as notes & coins, cheques etc. then the current status quo will remain. The face of banking will thus be more of the same, and the regulatory authority will continue to be Central Banks. Between these two positions may be many variants, depending on the appetite and preferences of customers, and the pace at which they are willing to embrace change. The essence of the Austin Okere’s Five Forces model is to enable players equip themselves with the imperatives that will ensure that their business is continuously relevant in the sector. It helps to guide the formulation of your prediction based on the following considerations: · whether there will indeed be a disruption · What the disrupted space will look like · The scale of disruption · The pace of disruption A correct application of Austin’s five forces model will define the difference between whether you continue to be in business, or whether your business model will become irrelevant and redundant. Even though I developed the Austin’s five forces model, primarily to analyse the direction of the future of banking, the model can also be used to analyse any industry which is susceptible to disruption from the pervasive blockchain technology; including Real Estate; e.g. EY’s Australian operations piloted a real estate blockchain ecosystem that is now being used in the market to trade full, and even fractional ownership of properties. And also Government; e.g. Ukraine has partnered with global technology company, the Bitfury Group to put a sweeping range of government data on a blockchain platform. Dubai also has an ambitious blockchain strategy to issue all government documents on blockchain by 2020. I will like to acknowledge due credits for this work to all blockchain enthusiasts, whose previous works have provided valuable insights, and also to my dear Son, Iheomimi Okere, who is quite artistically inclined, and has been able to correctly interpret my model in an aesthetic schematic.
*Contributed by Austin Okere, founder of CWG
ITREALMS ... everything news digitally!
*Image by Omimi Okere
Enterprise software provider of
leading mobile financial services technology, RedCloud Technologies, has signed
a partnership agreement with Innovectives LLC to deploy its cloud based
solution for agency banking across Nigeria, in conjunction with its partner,
TSI Global Technologies, reports ITRealms.
According to Katia Hill, the chief
operating officer, RedCloud, the alliance would enable Nigerian banks, mobile
operators and other financial institutions to grow their business and improve
customer experience in the market by reaching users in remote areas, offering
customer registration and giving over-the-counter customer financial
transactions such as utility bill payment, airtime top-up and other innovative
financial services.
“Being able to align ourselves with
an organisation like Innovectives, truly supports our commitment to enable
banks to reach more customers and offer innovative and convenient financial
services. This cooperation is a stepping stone for RedCloud in Nigeria, where
much is still to be made for financial inclusion.”
Already, Innovectives has an existing
network of over 1000 agents comprising small and established institutions such
as retailers, petrol stations, and service providers. The goal is to reach over
one thousands institutions in the next five years in order to achieve its vision
of being the leading integrated fintech company contributing at least 30% in
the market.
Nigeria’s move to enhance financial
inclusion as set by the Central Bank of Nigeria [CBN] includes the issuance of
two licenses to Innovectives Limited. Operating as Super Agents within the
financial system, the company will deploy, operate and manage interoperable
agency banking and mobile financial payment networks as approved by the CBN
with selected retail outlets operating as agents under the framework.
The World Bank has reported that the
ten countries with one of the highest proportion of residents living unbanked
in extreme poverty are located in Sub-Saharan Africa. Even remotely, mobile
financial usage is more widespread than having a bank account.
Agency Banking benefits in Nigeria,
she explained would include removing intermediary agents as well as speeding up
processes and waiting periods. The reduction in cumbersome processes gives
greater levels of global flexibility and efficiency daily operations as well as
improving bank’s global profile, status and presence.
MD/CEO, Innovectives, Emmanuel Agha,
said, “Our choice for RedCloud was based on their proven expertise in financial
services and agents management in emerging markets. Their product readiness,
flexibility and configurability allow us to deploy our services throughout our
agent’s networks and set-up tailored agent hierarchy and fees management to
suit the specificities of our business.”
RedCloud One platform would connect
to Nigeria Inter-Bank Settlement System (NIBSS) to access all licensed banks
and financial service providers in Nigeria and provide complete
interoperability to Innovectives network of agents. RedCloud is supported
by its local partner TSI Global Technologies for integration, deployment and
support services. TSI Global Technologies has already helped many Financial
Institutions in the area of integration and its core operations. Its
consultants have been involved in a number of Apex banks integration in the
subregion.
Rasheed
Adegoke is the Group Head,
Information Technology (IT) at First Bank of Nigeria plc. In this exclusive
interview REMMY NWEKE, he says FBN would reduce transaction time to two
minutes. Excerpt:
Let’s start by you telling us how your team has been using
technology to drive FirstBank’s services?
As you are probably aware,
First Bank is the leading institution in terms of deployment of technology and
the use of technology to deliver superior banking services to its customers. In
the past few years we have actually focused on what you would call a second
phase of our transformation efforts which started from the Century Two project
that saw us deploying modern technologies way back in the early part of the 21st
century, around 2000 to 2002.
Now, what we have done in the last three years is to focus on a
coordinated transformation of the business with technology again being at the
core of that transformation effort. So, in the last three years, we have
improved our technology infrastructure to generally improve the reliability of
our services across channels; both at the branch and our electronic delivery
channels.
If you relate that to the growth that we’ve also seen in the
numbers that First Bank is churning out, you will see that there is consistency
and a direct correlation between the improvements that we are achieving in the
technology and service delivery space and the customer patronage and growth in
our business both in terms of size or volume and profitability.
Therefore, in the last three years we have doubled our balance
sheet and we have also increased our customer numbers from under 5 million to
over 7 million accounts today and that also has translated into the share of
wallet that we have of each customer. We have also been able to generate a lot
more transactions from our existing customers in that process.
Other statistics that points to the impact of the transformation
of our technology include things like volumes of transactions across electronic
channels and you would see that First Bank leads other providers. We have more
than 30 per cent share of the issued cards volume in the market space and we
also process more than double the volume of transactions of the number 2 bank
on the industry’s payment switching network.
That basically summarizes the impact that technology
transformation has made on First Bank operation in the last few years. I think
I will end that by saying what underscores our usage of technology in First
Bank is the award we got last year which was tagged the Innovation Award from
the Bankers Magazine, that award came out of a number of initiatives but
the core initiative then was the introduction of the biometric ATM. We are the
first bank and still today the only bank that have biometric ATM services,
although we have not extensively rolled-out, but we have deployed it in a
number of our branches.
For the benefit of the ordinary Nigerians, can you give us some
insights to what you mean by biometric ATM?
Rasheed Adegoke
Well, the biometric ATM essentially like any other ATM except that
we have enhanced it with the ability to read fingerprints as an additional
security feature to protect our customers against fraudsters. Basically, what
happens when you go to an ATM today; you need your card and a PIN number.
Although there has been a lot of effort on the part of the industry to improve security
like the change in card standard which is not limited to First Bank alone. It
was an industry wide initiative to move from the Magnetic Stripe card which was
what was initially introduced into the Nigerian market, and which is also a
relatively insecure platform to the Chip and PIN platform, which essentially is
a much more secured card than the Magnetic Stripe card that could easily be
cloned by fraudsters.
So, the industry has done that move, however we at First Bank are
“upping the game” and saying that there are a number of our customers that are
in the rural areas, maybe that’s also because First Bank has the spread that
most other banks do not have, and we have the experience of serving both the
urban rich as well as the rural poor.
Some of the rural masses are not too good with numbers so when you
say they should choose a PIN number, you won’t be surprised if someone chooses
1111 and so, if that person misplaces his or her card, it is very easy for a
fraudster to guess the PIN number, so for such customers you also have to get
their fingerprint with a biometric ATM. That’s the extra level of protection
that we have introduced into the market place.
Most banks in the country presently, including First Bank seems to
fall in line for foreign of IT applications, and from your own perspective,
what would be your rating of local applications in Nigeria, basically?
Well, I will be very frank and objective, treating it like a
balance. I think you would say that we do have skills within the Nigerian market
place to manage IT. We have skills to do software development, however what
tends to happen within the software space itself is that there are various
categories of software, from the system software which are like the operating
systems like Windows, UNIX, and the iOS that runs on Apple platform to business
applications starting from simple human resource management, payroll
applications to very complex systems like the ERPs that manage entire
manufacturing operations or core banking software that are used to run banks.
Now, we are not playing at all in the system software space so we
do not have, for instance, the operating system developed by Nigerians, even
though you might have a few Nigerians contributing to the development of
operating systems because each of the big players like Microsoft do have a
reasonable population of Nigerians within their employ.
We also do have freelance programmers that contribute to open
source software like Linux development and some of them are Nigerians. However,
when it comes to actually having or owning a branded operating system product,
Nigeria is not playing in that space. Now when we come to business application
space we also have a number of Nigerian companies that have played very well in
building human resource applications, small scale ERP solutions, and one
company comes to mind easily, Systemspecs with their human manager application
which have been highly successful by all means.
On enterprise applications, we also have a number of players that
have attempted to play in that space and not all have been equally successful,
but we have some players that have stayed upwards of 20 years in that space so
you would say they have achieved some level of success and again a name that
comes to mind is Computer Systems Associates; they have a core banking software
which has been sold not just within West Africa but also in East Africa and
other emerging markets that actually needs their solution. They have also sold
a version to microfinance banks within Nigeria.
Now coming back to the question of whether Nigerian software
companies have matured to the point of developing robust core banking software,
I would say it’s a yes and no. Yes, to the extent that the basic skills to do
it are there, and I’ve given the examples that prove that those skills are
there if we focus well enough.
However, in terms of mindset, we’re not yet there. Software
business is a long term business, so, you have to make investment for the long
term. Nigerian investors on the contrary are mostly short term investors. So
you don’t go into software with the mindset of getting back your investment in
six months or twelve months. That’s what has actually not made made-in-Nigeria
software to mature to that scale where they can easily compete with internationally
developed applications because if you are investing for the long term, it means
that you need to be able to retain certain skill set for the long-run.
If you have business architects and software architects that are
working within software companies and the turnover of your staff is maybe every
eighteen months, you have to recruit new staff because the good staff have
left, you won’t be able to actually go for the long run and these are some of
the issues that the local software developers or investors are still dealing
with.
On the other hand, you need some level of capitalization to be
able to hold on for that long in terms of being within the software development
line so that you are not hitting the market place with an under-developed
products that you want to start earning from. By and large, if we change our
focus, if we change our investment mindset and focus on software as a long term
business we can actually compete with other internationally developed
applications in Nigeria.
Earlier on, you made mention of First Bank running on Finacle 10,
what was the business decision behind this?
First Bank essentially, has four key drivers of growth or four
pillars of the business strategy; one focus on growth, the second is on
improving service delivery and attaining service excellence, the third is
talent management being able to retain the best talent within the industry and
the fourth is performance management, both at the individual level and the
group level.
If you look at those pillars, central to it is service excellence
because every business exist for one purpose only and that purpose is to
recruit and retain profitable customers, that’s why businesses exist, so if a
business is not able to meet the needs of its customers both now and into future,
that business will not be a sustainable business.
So as a service enterprise, we need to continually improve our
service platform, as you know infrastructure is central to most things. If you
use the nation as an analogy, we are where we are partly because of failure of
infrastructure so one of the key service delivery infrastructure for a bank is
a core banking software, because really a bank’s business if we all think of it
not as much managing money but a bank’s
business is actually managing information.
Whether you are talking about ensuring that you properly keep the
information for 7million accounts and ensure that there is no mix-up in the
management of that information or you ensuring that the information required to
dispense cash at the ATM is readily available for the ATM to work. That’s what
banking is about; it’s about managing information, so we need to continually
improve that platform for managing information which is a core banking
infrastructure.
Presently, we have set aggressive target for ourselves in the area
of service excellence and our existing platform which is the Finacle 7 cannot
continue to serve us to meet those aggressive targets, so we want to be able to
be quicker in introducing new products into the market place, that’s what
Finacle 10 would give us as an edge over Finacle 7. We want to reduce the time
it takes to process the withdrawal transaction, currently we spend an average
of four (4) minutes; a customer will spend not more than four minutes in front
of a teller officer to do a withdrawal transaction, we want to halve that to
two minutes.
Yes, we have improved our infrastructure; our back-end
infrastructure, so our processing facilities are faster, but we also need to
improve on the underlining software that runs the process. We also want to
simplify our processes further in the front end such that the teller spends
less time trying to post transactions and spend more time interacting with the
customer, that will mean some improvement of our core banking infrastructure,
so all of these are the business drivers that has lead us to say we need to
upgrade to Finacle 10, because it’s going to give us much more flexible service
delivery infrastructure that would enable us achieve that level of service
excellence that we set for ourselves.
I would like to know your take on the cash-lite Lagos and eventual
deployment across the country, and what is First Bank’s readiness in the long
run?
First, I would say that the cashless or cash-lite drive is the
right move, we at First Bank have been moving in that direction before CBN
(Central Bank of Nigeria) came up with the policy in order to drive it across
the industry. Which is why, if you go back to my initial summary, some of the
highlights that I made were the investments we made in actually enhancing our
electronic delivery channels which has translated into us, I mean First Bank
achieving a larger share of the market space for electronic transactions.
We had actually been quiet clear with our own strategy as First
Bank in driving towards a cash-lite situation, because we have been trying to
move or migrate our customers to the electronic channels, so that they deal
less with cash. Now, having said that, it’s a good policy, it’s something
that’s going to help the economy because the velocity of transactions will be
much faster if you are using electronic means, and you can imagine that we have
move significantly forward from a situation whereby upcountry clearing was 21
days.
I don’t know if you still remember that there was a time in
Nigeria when it took 21 working days to clear a cheque if that cheque is not a
local cheque and local cheque itself took about a week for you to be able to
get your money to where we are today which is we have a turnaround time on
clearing items which is still T+2 and that has been shortened further to a next
day.
What do you mean by T+2?
T+2 means the day you
submit the cheque for clearing you add two days and on the third day you are
going to get credit in your account but that is being shortened further to a
next day clearing which by next month actually we should be having a taste that
fully. That is what has happened within the clearing system and we have seen
that, that has actually impacted the volumes of transactions that go by the way
of cheques rather than cash exchange.
Also, what has happened which we didn’t note is that it was like a
first phase of the movement towards less cash because if it takes 21 days for
you to get value for money, you would hardly do any transaction through that
channel. Now, what debit card have done, because debit card by their nature are
actually cheque replacements because cheques are instruments by which you
access your account; debit cards are also instruments by which you access your
account for payment.
With the introduction and wide-spread adoption of debit cards, we
actually have gotten a faster mode of rendering payment which doesn’t even have
to go through clearing, so you could say you have instant clearing with debit
cards. So, if I actually want to transfer money to you, if I have a portal that
allows me to debit my account using the security on my debit card and transfer
money to your own account, then I would basically be giving instantaneous
credit into your account, so that’s like instant settlement, what CBN has done
is to try to focus us on that platform, the cash-lite policy is essentially
trying to focus us on the efficiency of the platform that is built around the
card and the mobile payment which it has also introduced a license for, and
which are all instant settlement platform.
Essentially, what we do with exchange instrument is largely payment,
exchange of value so if we are able to do payment faster, transaction velocity
increases and therefore we can actually ensure that the economy becomes a lot
more productive. One of the reasons which CBN has also used as a justification
for the policy which is a valid reason, is the sheer cost or waste that is
going into handling cash because we all know how much it takes to print one
naira note and if you are frequently using it, you need to replace the note
more frequently, that’s a cost that goes into CBN’s account. Besides that the
bank that handle cash needs to employ people to do the cash counting and they
need to pay insurance to secure the cash that is held in their vault, we know
the risk of armed robbery in the country and some time the loss of lives that is
associated with the easy access to cash.
So, as a policy, we agree that’s the way it should go and what we
are doing at First Bank is that we are ensuring that as you adopt the
alternatives to cash, you basically do not get services that are less than what
you will get with the use of cash.
Our platforms are very reliable, we have moved from less than
2,000 active Point of Sale (PoS) terminals to over 8,000 that we have deployed
and we do intend that by the end of the year, First Bank alone will have
deployed more than 20,000 PoS is we are looking at focusing on Lagos area.
Across the country we will be talking of bigger numbers, but we are focusing on
Lagos because the focus this year even by the industry is really around Lagos,
so we are focusing on Lagos and we are saying that Lagos can really take that
depth of PoS deployment. There are a lot of places we go, all we do is go to
the nearby ATM, withdraw cash so that we can pay at the point of sale, why do
we need to go through that when you can swipe your card at the point of sale
and actually get value.
Why is it that some of the PoS are not working?
Those are the problems that we had initially, because the industry
had not focused on that. You know, there was also a time that an average bank’s
branch, the chances are that the network would be down was high, or if you go
to the bank’s ATM the chances that the ATM would not be online was high but
when we focused on that as an industry you see that those cases are very
remote; it’s not perfect right now but they are remote because most banks have
multiple links, most ATMs have multiple links and the same thing is happening
to the PoS right now where you have PoS that are deployed before having only a
single connectivity, today we are having PoS that have multiple connectivity,
multiple GPRS – Global Packet Radio Service, and all of that.
What causes some of the hiccups in transactions from time to time,
especially on the issue of ATM, from your professional perspective?
You talked about challenges, we cannot operate within a vacuum, we
know the state of infrastructure within the country, a lot of what we are doing
right now has to ride on the infrastructure that we have; communication links,
unreliable electricity.
If you actually want to run a branch that you would have an ATM
and that ATM needs to be available for 24-7, it means that even when the branch
has closed there must be power that is powering the ATM, we have gone ahead to
install inverters to protect those equipments and ensure that there is power
around the clock, so having put that background there, you would understand
that there is some point of failure that could actually arise, what tends to
happen is that we do have sometimes the communication links for instance in the
middle of an ATM transaction so a customer has slotted in the card and the pin,
and the transaction was about to take place and there is a failure of
communications.
What the ATM has been trained to do is that it would actually
reverse the transaction that has just failed because before parting with money,
the ATM will debit the account to be sure the money exist and then dispenses
money to you. However, let’s assume that the ATM had debited your account and
the link fails, the ATM will wait for an acknowledgement that the debit has
actually happen and then it doesn’t get, so it would return your card and also
automatically it would raise a credit back into your account. We all experience
it and I’m sure you have also experienced it.
If you are a First Bank customer and I hope you are, what happens
is if you slot in your card and have failed transactions you would get two
alerts almost at the same time, you will get the debit alert and you will get
the credit alert immediately, which shows that there is no human being manually
reversing the transactions because the system itself is automated to know that
something has failed and to credit you back with your money.
However, sometimes that automatic process doesn’t kick in and
that’s why we set up a dispute resolution mechanism which ensures that within
24 hours after such incidence of failure of the automatic reversal, someone in
the back office is able to credit you back, so there is not any instance that
we know, for instance, at First Bank and I believe across the industry really
that someone’s account has been debited and the money is not been credited back
except where people have been defrauded, because we are aware of cases of
people losing possession of their cards or compromising their PIN, and in such
cases there are also incomplete transactions on those account.
I am sure you know that bulk of electronic transactions rides on
networks, which in-turn depends on Internet Protocols (IPs) to deliver,
therefore what are banks doing on migration, especially are we looking forward
to having FBN as the first Nigerian bank to hook to IP version 6?
Let’s first define the IPv4 and v6, essentially the Internet
Protocol version 4, let’s keep it simple is just an addressing scheme, just
like you going into a street in Lagos and you will see old number 5, new number
16, IPv4 and IPv6 are numbering schemes. IPv6 was introduced because the
address space on IP version 4 was actually now more or less fully used because
of the rapid growth of the internet when countries like China started trooping
in and rapidly acquiring internet addresses.
Now, it doesn’t mean that all the addresses on IPv4 becomes
invalid, there is no organization that is getting shut down because they are on
IP version 4, and there is a transition plan that would actually allow people
to have both IPv4 and IPv6 work side by side. So for my internal network for
instance, I probably do not need to change the addressing scheme to IP version
6, because the number of devices and equipments that I have on my internal
network can still be managed with IPv4. And as it is today, even today on the
IP version 4 addresses are still able to communicate with any other hosts,
right, because there is that transition management process that has been set up
for a transition into IP version 6.
So, we do have a plan for a transition to IP version 6 but is
really not something that is going to give us any particular edge. It is not
something as you would say is quite strategic; it is not something that is
going to give us an edge. Everybody will ultimately transit to IPv6 if we
stretch into the very long future so but it’s not something we need to rush
into, we do have a plan to ensure that there is clearly no disruption to our
business due to the adoption of IPv6.
What would be your advice to Nigerians, especially First Bank
customers and what’s First Bank doing in providing facilities like loan for
Small and Medium Enterprises (SMEs) and encouraging those in the IT sector?
When we began, I told you that First Bank basically have the
broadest operation in Nigeria serving the very rich and large institutional
customers to the rural poor and how do we do that, we have our business
structured around segments, so the SMEs would fall under our retail segment and
we do have a group which happen to be the largest group accounting for about 50
per cent of our balance sheet which is actually the retail group, for them to
be 50 per cent of our balance sheet, means that we are actually lending to
them.
If you look at all the key sectors, First Bank is not just playing
there but we are also leading even in lending within those sectors. If you look
at agriculture, First Bank is one of the few banks that got the CBN
intervention fund and that’s because of the quality of lending that we are
doing within the agriculture sector and the fact that we have demonstrated to
CBN that we have the processes to actually understand and support that sector.
If you look at telecoms, when the telecoms industries took off
with advent of Global System for Mobile (GSM) communications, most people
didn’t believe in it; we were one of the first players in that space, not just
lending to the operators but also lending to their distributors and those in
the downstream of the telecoms operations.
Any
sector you look at, especially the SMEs that you are talking about, we are
basically very strong players there, as First Bank. But when you look at the
group it even get more interesting, because we do have First Funds, which also
provides what you could call seed capital type of investment. It’s more like I
won’t call it a straight venture capital vehicle but is close to it, we do take
equity investment in some of the SMEs that have proven that they have a viable
business plan that’s through First funds because you need to appraise those
funds differently from the way you appraise loans. Then, we have the
microfinance, the FBN Microfinance that also caters to the everyday rural
business person that needs N50,000 in order to be able to move tomatoes from
Mile 12 to Ajangbadi and have a viable business. So, we cater to the lowest of
the SMEs and also we cater to the large customers.
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