E-Financial
Six Cardinal Sins affecting ATM Accessibility in Nigeria.
“Bauchi Deputy Governor Can’t Access Cash At ATMs”, the headlines screamed on Jul 1 2015. Apparently, there was no money in any of the three ATMs that the Deputy Governor tried, just to access N20k, according to a statement by the Permanent Secretary, Rabi’u Bello.
ATMs are the most popular channel for bank customers
This is indeed a sad commentary for banks in Nigeria, especially against the backdrop of the recent NOI polls on Bank Financial Channels in the country, which revealed that ATMs were the most visible proceed of the banking sector reforms to Nigerians.
According to the survey, of all the bank channels, customers used ATMs 68% of the time compared to just 6% for Internet Banking and 6% for Point Of Sale terminals (PoS) respectively, with most customers using the ATMs more than once a week. The ATM has assumed great importance as the barometer of a bank’s brand as far as customers are concerned.
It is therefore difficult to phantom why banks have not taken advantage of this ubiquitous channel to enhance their brand value and gain customer loyalty.
Given that my company is an active player in the industry as a Value Added Reseller of Wincor-Nixdorf ATMs, I feel obligated to disclose my interest; but it is this same vantage position that affords me the insight to comment on this passionate issue bedeviling Nigeria’s bank customers.
The Six cardinal sins
In my view the unavailability of Banks’ ATM are predicated on six cardinal sins namely; Suboptimal Support Strategy, Low Spread, Low Penetration, Old Systems, Dirty and Mutilated Currency notes, and Techies running the show instead of business savvy personnel.
Suboptimal Support Strategy
The major culprit of ATM unavailability is the suboptimal support strategy of most banks. They are suboptimal because they usually fall on the sword of ‘penny wise and pound foolish’. Consider the following scenarios; a situation where by merely installing appropriate monitoring tools provided by the manufacturers, ATMs can be remotely diagnosed and most times proactively, before a fault occurs. In this situation the fault can be trapped and fixed before it occurs, or in the case where a fault has occurred, the engineer appears at the site with the appropriate spare part, rather than make two trips, one to diagnose and the second to carry the right spare part to fix the problem. By saving on the investment on the monitoring tool, the bank is losing much more on the opportunity cost of unearned fees and more importantly, on brand impairment.
Most banks opt out of weekend support for ATMs in order to save support money. This is akin to cutting down on cleaning at the cinemas at the weekends. This is just so counter intuitive. During the week, the ATM infrastructure benefits from the widespread support from the branches where they are located. The bank’s custodians ensure that the surround environment such as power and networks links are available, and any cash jam or out of service issue is quickly resolved or escalated to the support company. It is during the weekend when that support structure is unavailable that ATM attendance is most required. And it is precisely this critical period that banks chooses not to support their ATMs in order to save cost. What ostensibly happens is that the ATMs breakdown, being mostly mechanical devices, and there is no opportunity for any call-out to repair them. The ATM faults are piled up and reported en-block to the support company first thing on Monday morning, but they become overwhelmed because this bucks the trend of faults forecast under normal circumstances for which they would have been prepared. Being saddled with a ton of faulty ATMs simultaneously is not normal and inadvertently results in shortages of ATM Spares and long wait times. To compound issues, the banks typically do not make it easy for the support partners to have spares on hand by, insisting on maintenance payment in arrears. Maintenance payments in advance will greatly help sufficient spares procurement and readiness to attend to faults on time.
Another ‘catch 22’ situation in the support strategy relates to access of the ATMs for maintenance purposes during the weekend, in the few cases where banks have signed for weekend support. There is the dilemma of having the two people who each have an access key for the ATM, to both be on site, as the keys are simultaneously required to open the ATM from a security perspective. Many of the custodians live very far from the ATMs which keys have been entrusted to them, and so there is an inherent wait time for them to make the long journey to the ATM to open it for the support personnel to have access for repairs, or even for cash loading in the case of a cash out. It may be expedient to zone ATM keys to custodians who live close to the particular ATMs, or make adequate alternate arrangements.
Low Spread
The second cardinal sin is the poor distribution of ATMs across the country, with most of them concentrated around the 5,000 odd bank branches. Going by the statistics of the Central Bank of Nigeria (CBN) that there are 12,000 ATMs in Nigeria, and following the trend of at least two ATMs per branch, leaves only 2,000 ATMs to be distributed across all the other locations requiring cash dispensing in Nigeria. Typically, ATMs should be liberally placed around high footfall areas such as Malls, Markets, Petrol Stations, etc. The realities of distributing only 2,000 ATMs across all these areas are quite stark; not enough to go round. Barely enough to provide two ATMs each, for our 774 Local Government Areas.
Low Penetration
And this leads to the third cardinal sin, low penetration of ATMs where they exist. The story was told around Christmas of 2013, where the only ATMs that seemed to be working on the whole Gbagada axis were the couple at the Charlie Boy Bus stop. Of course the queue had built up to the extent that faint hearted customers rather opted to go without cash than risk the possible consequences of a stampede. The problem could be solved by providing appropriate number of ATMs per location based on a study of the queues. If the intention is to keep the customers from crowding the banking halls, it seems to me a circular argument bickering about the ATM and support costs, because this has to be compared against the cost of a bigger branch and more tellers, with their attendant salaries and benefits should the customers be compelled to go into a branch for lack of adequate ATM channels. The ATM penetration in Nigeria is about 11.4 ATMs per 100k adult population. Comparatively, Indonesia’s penetration of about 37 ATMs per 100k adult population is over three times that of Nigeria. South Africa has 60 ATMs per 100k adult population, while the UK has 124 ATMs per 100k adult population
Old systems
The fourth cardinal sin is over-flogging the ATM well past its ‘use by’ date. Many senior bank officials will typically have their official cars changed after every four years (the ATMs are much less than half the costs of the status cars of the banks’ middle management staff), yet even where statistics show that the cost of repair of a consistently failing old ATM is unsustainable and will be cheaper to replace, there is a deep reluctance to do so. This could perhaps be because the support partners aren’t given the opportunity of slab pricing, where they charge a higher support premium for very old systems. In the end, every shortcut gradually catches up with us. The system is just not able to perform the function for which it was procured, and the customers bear the brunch.
Dirty and Mutilated Currency notes
The fifth cardinal sin is loading the ATM cassettes with currency notes not fit for that purpose. While it is understandable that it is not possible to always have crisp notes in the ATM, every effort should be made to sort and aerate the notes going into the ATM to ensure that that they are fit for purpose, and do not cause cash jams, which throw the ATM out of service, notwithstanding the amount of cash in it. It is common knowledge that bank staff and their friends do somehow find crisp notes for ‘spraying’ at social functions at the weekends. These are the kind of notes that should be loaded into the ATMs and not the unfit ones that will quickly fill the ‘reject bin’ and render the ATM out of service.
Techies running the show instead of business savvy personnel
The sixth cardinal sin which is not limited to banks, is the common mistake of promoting techies out of their area of competence and comfort to business managers. Techies should have their own growth tracks and should aspire to the highest specialist positions where they can continue to usefully contribute to the organization. Having said so, I have seen techies who have imbibed deep management skills and made the cross from the technical line to the business line. These are indeed rare breeds, whose background in both technology and business help them to make better managers. But having pure techies run important businesses such as ensuring that the over 76 million Nigerian bank customers consistently have ATM availability, and the managerial intricacies that this will demand, is not fair to them, nor to the customers. In todays’ cashless Nigeria, e-Banking is going to be the key to the success or failure of a bank, based on her ability to retain customers. The need for this critical Division to be appropriately manned cannot be overemphasized.
If we get these right, then the deputy Governor, and indeed every bank customer will have the true benefit of the use of their ATM cards.
Austin Okere is the Founder of CWG Plc, the largest Systems Integration Company in Sub-Saharan Africa & Entrepreneur in Residence at CBS, New York. Austin also serves on the World Economic Forum Business Council on Innovation and Intrapreneurship.
Securities and Exchange Commission (SEC) has commenced a nationwide enlightenment campaign to help Nigerians recover unclaimed dividends and other monies arising from capital market transactions.
The campaign, which began with a town hall meeting in Lagos on Thursday, is aimed at sensitising investors on the existence of unclaimed monies, the role of the National Investor Protection Fund (NIPF) and the procedures for verifying and recovering legitimate claims.
Emomotimi Agama, director-general of SEC, who was represented at the event by Hafsat Rufai, director, Registration and Exchanges, Market Infrastructure Department, said the initiative was necessary to ensure that funds belonging to investors were returned to their rightful owners.
Agama said unclaimed monies administered by the NIPF included return monies from public offers, scheme consideration from mergers, acquisitions and corporate restructuring transactions, as well as other funds belonging to investors that had remained unclaimed.
He noted that the Commission considered it unacceptable for investors’ funds to remain unclaimed, adding that many investors and their families were either unaware that such monies existed or did not know the procedures for recovering them.
Agama said the SEC Board had approved a nationwide public enlightenment campaign to sensitise Nigerians on unclaimed monies, the role of the NIPF and the process for making legitimate claims.
He said the Lagos programme marked the commencement of the outreach, which would subsequently cover the six geopolitical zones and the Federal Capital Territory.
The director-general said the campaign would also address the transmission of securities following the death of an investor, noting that families were often unaware that their deceased relatives owned shares or other capital market investments.
He said even when beneficiaries were aware of such investments, many lacked knowledge of the legal and administrative procedures required to obtain probate or letters of administration and transmit the investments to the rightful beneficiaries.
Agama said the Lagos programme included an expert session on probate administration and the transmission of securities to demystify the process and provide practical guidance to investors and their families.
He urged investors to maintain proper records of their investments and encouraged families to take steps to preserve inherited wealth.
The SEC DG also warned Nigerians against Ponzi schemes and other fraudulent investment arrangements, saying fraudsters continued to exploit economic pressures and digital platforms to lure unsuspecting members of the public with promises of guaranteed and unusually high returns.
He urged the public to be cautious of investment opportunities offering risk-free returns, stressing that investor education and vigilance remained critical to combating financial fraud.
Speaking on behalf of Lawal Pedro, attorney-general and commissioner for Justice,Lagos State, Olujoke Ogunojemite, deputy director in the Ministry of Justice, commended the SEC for extending the campaign to Lagos and recognising the role of legal institutions in resolving issues relating to unclaimed dividends and other assets.
She said the issue had a practical impact on beneficiaries who were unable to access assets after the death of their loved ones.
Ogunojemite said the ministry was committed to ensuring that legal processes did not become barriers to beneficiaries seeking to recover legitimate assets.
She described the SEC’s outreach as commendable, saying it would help restore assets to their rightful beneficiaries.
World Bank has said that despite nearly three years of economic reforms by the federal government, about 79 per cent of Nigerians remain poor or vulnerable to falling into poverty.
The bank stated this in its newly approved Country Partnership Framework for Nigeria, covering 2026 to 2032, and its accompanying Streamlined Country Diagnostic.
The report which highlighted the country’s deepening social and economic challenges, indicated that while recent macroeconomic reforms have helped stabilise the economy and restore investor confidence, the benefits have yet to translate into meaningful improvements in living standards for most Nigerians.
The World Bank noted that the seven-year strategy seeks to support Nigeria’s ambition to create more and better jobs through private-sector-led growth while accelerating poverty reduction.
According to the Streamlined Country Diagnostic document, “Thirty-three per cent of its population is ultra-poor (food insecure by age-weighted caloric intake), 61 per cent is below the poverty line, and 79 per cent is near poor (below the poverty line or vulnerable to falling back into poverty).”
The World Bank pointed out that Nigeria’s economic performance over the past decade had been constrained by structural rigidities, policy missteps, dependence on crude oil, and repeated external shocks, leaving millions trapped in poverty.
It stated that about 139 million Nigerians currently live below the national poverty line, with poverty concentrated largely in the northern part of the country.
The report also noted that more than 86 million Nigerians remain without electricity, while three to four million young people enter the labour market every year with limited employment opportunities.
It added that sustaining macro-fiscal and structural reforms would be critical to reducing inflation, expanding fiscal space and ensuring that recent economic stabilisation translates into improved living standards.
According to the report, the reforms have begun to improve macroeconomic indicators.
Economic growth increased from 3.5 per cent in the first half of 2024 to 3.9 per cent during the corresponding period of 2025, foreign reserves exceeded $42bn, fiscal deficits narrowed, and investor confidence strengthened.
However, it warned that high inflation continues to undermine household incomes. The report stated, “High inflation, though declining, continues to erode real incomes, particularly for the poor. Social protection efforts to support the most vulnerable have been slow and uneven in their rollout.”
The World Bank added that although the reforms helped Nigeria avoid a more severe economic crisis, institutional weaknesses, weak policy coordination, and inadequate budget transparency continue to pose significant risks.
It warned that sustained reform implementation, backed by deeper structural measures, would be required to improve Nigeria’s medium-term economic outlook.
Under the new Country Partnership Framework, the World Bank said job creation would serve as the primary pathway for reducing poverty.
The report explained that international experience from countries such as India, Indonesia, and China shows that moving people into productive employment remains the most effective tool for reducing poverty.
To achieve this, the framework will prioritise labour-intensive sectors, particularly agriculture and micro, small and medium enterprises, while addressing structural deficiencies in electricity, digital infrastructure, education and healthcare.
The Nigeria Revenue Service (NRS) said the rollout of electronic invoicing (e-invoicing) will strengthen tax compliance, curb revenue leakages and improve transparency in tax administration as it moves to fully digitise the country’s tax system.
The Project Lead, NRS e-Invoicing Project, Mohammed Bawa, stated this at the DigiTax E-Invoicing Compliance Breakfast Session held in Lagos.
The event, organised by DigiTax, an NRS-accredited e-invoicing platform, formed part of efforts to support the agency’s ongoing education and sensitisation campaign on the e-invoicing mandate.
Bawa said the initiative aligns with global trends in tax digitization and is expected to help improve Nigeria’s tax-to-GDP ratio, which remains one of the lowest in Africa.
According to him, the system will provide the NRS with greater visibility into transactions across sectors, formalise activities within the informal economy and standardise invoice formats nationwide using globally recognized invoice schemas.
He added that e-invoicing would improve operational efficiency for both businesses and tax authorities while supporting the NRS’ transition from manual and electronic tax administration processes to a fully automated system-to-system interaction model.
Bawa noted that the legal framework for implementation is backed by the Nigeria Tax Administration Act, which prescribes penalties for non-compliance.
He disclosed that the NRS has completed onboarding large taxpayers and is preparing to enforce compliance with defaulting entities.
According to him, medium taxpayers are expected to begin compliance in the third quarter of 2026, while onboarding of emerging taxpayers will commence in 2027, with full adoption targeted for all taxpayers by the end of 2028.
Bawa urged taxpayers yet to be onboarded onto the platform to begin the process and work with accredited service providers to ensure compliance.
Speaking at the event, Country Director of DigiTax Nigeria, Olumide Akinsola, urged businesses to look beyond their internal systems and assess the compliance status of suppliers and counterparties.
He warned that businesses whose suppliers fail to transmit invoices through the MBS platform risk losing eligibility to claim Value Added Tax (VAT) input credits on such transactions, describing the resulting supply chain exposure as a significant commercial risk that many organisations have yet to quantify.
Akinsola also announced the launch of DigiTax’s white paper, ‘The State of E-Invoicing Readiness in Nigeria,’ which examines compliance adoption trends and the readiness gap across different taxpayer segments.
He added that DigiTax operates in Nigeria, Kenya, Zambia and the United Arab Emirates (UAE), noting that experience from those markets shows businesses that integrate early are better positioned to avoid disruptions when enforcement begins.
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