Nigerian CommunicationWeek

‘How e-business reduces cost of Retail Banking’

Segun Agbaje, deputy managing director, Guaranty Trust Bank, has emphasized the advantages of e-business as regards to retail banking in Nigeria.

In a paper presented at the just concluded Card Expo Africa Conference, titled ‘e-Business: The Future of Retail Banking’, he said that the e-business advantage include: reduction in cost per transaction, elimination of human errors, increased profitability in the long run, extension of banking hours without additional infrastructural and human investment, access to banking services at all times, increased customer satisfaction and shorter queues in banking halls.

According to him, internet and GSM penetration in Nigeria is a major determinant factor of the Nigerian e-business scene, adding that the success of e-business lies with the telecoms industry.

He said that May, 2008 indices show that there are 21.7 Million Interswitch debit cards in the Nigerian market, that is, 15.6m Debit cards and 6.1m Cash cards; 61 Million transactions done via Interswitch platform in the month of May, 2008 alone; at least 100,000 International cards issued by Nigerian Banks; 5,268 ATMs installed and active and 8,881 POS terminals deployed across the country.

He intimated that the top tier banks dispense an average of 10 Billion Naira monthly via ATMs and that every Nigerian Bank offers some form of Internet banking service in reaction to changing trends in the industry today.

Agbaje identified challenges in the industry such as unstable communication network in the case of Point of Sale terminals, people’s resistance to change, inadequate infrastructure, high setup costs, and resistance by merchants to pay for services and lack of knowledgeable human capital.

"By year 2010, Nigerian Banks would have jointly issued at least 40 million cards both debit cards and Cash cards, there will be over 9,000 ATMs in use and more than 15,000 PoS terminals deployed; the one billion mark in processed transactions will be attained annually; there will be a significant increase in cross border Card transactions due to the convertibility of the Naira and a reasonable portion of consumer loans will be availed via credit cards."

He recommended that the best strategy for retail banking is the collaboration of e-channels and Branch networks for optimum results.

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