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Lack of Dispute Resolution Mechanism Hobbles Financial Inclusion Initiative

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The objective of central bank of Nigeria to have 70 per cent of its adult population in the formal financial services sector by 2020 through its financial inclusion initiative is suffering a hitches as agency banking operators are faced with dispute resolution issues, Nigeria CommunicationsWeek has learnt.

According to Fasasi Sarafadeen Atanda, managing director, Ecosystem Hybrid Network, “there are no dispute mechanism in settlement issues between providers and agents as well with customers at agent location.

“The issues around PoS chargeback are beyond debit of customers as there is no complaint mechanism in place for financial inclusion services.

“In a formal banking system, there is complaint mechanism where customers are allowed to lodge complaint and tracking number given to them; if such issues were not resolved the customer can escalate it to CBN with the tracking number.

“For Agency banking, which is informal and still financial service the mechanism of formal should not be used in resolving complaints as the scenarios are different.

Today, if customers have issues at the PoS level and we the agents that interface between Banks and their customers at hinterland complain at bank branch, because of lack of knowledge they turn us back because they don’t understand the procedure that PoS is also issued by a bank .

He explained that, there are two parties involved in resolving PoS issues, the issuing bank, and the acquiring bank. “So, PoS is actually attached to acquiring bank when there is an issue, a customer should go to issuing bank that issued his card it is the responsibility of the bank to log it against the acquiring bank and ensure that the acquiring settles the account of its own customer.

“But, today they don’t do that because they lack knowledge most of them will ask customers to go to the bank that issued the PoS and collect their money. This means you are asking the customer to go and solve his/her problem. If the card is issued in Lagos and the customer travels to Maiduguri and use the PoS you are telling the customer to go to Maiduguri to ask the PoS agent of his refund. That is the problem we have today.

“We have been appealing to CBN to intervene by directing banks not to turn customers back to Agents for dispute resolution rather to resolve all electronic transaction disputes in the bank not at Agent locations, because agents are third party providers as they belong to one of the banks issuing or acquiring.

“Agents should be enabled to log complain on behalf of their customers as we are providing services at agent level, we should be  providing resolution mechanism at agent level  and the two should go together, you can’t sale service without problems. Agents are not protected like the banks

“The reason we want dispute resolution to start at the agent level is that banks cannot cope with the number of complaints arising from huge transaction that are done through PoS every month,” he said.

Victor Olojo, National President, Association of Mobile Money and Banking Agents of Nigeria (AMMBAN), added that recruiting 500,000 agents across the country within the next two years is not difficult and what is tall order to achieve is managing that number with poor infrastructure they are presently facing in the business of agency business,

“Presently, banks and licensed mobile money operators lack capacity to manager issues arising from network downtime. Web based solutions does not have the capacity to carry out transactions volume of up to 5,000 let alone when 500,000 are brought into the system.

“There must be concrete plans to improve upon available infrastructure to be able to support additional agents into the system. More so, there is knowledge gap in the management of agents by banks officers who does not understand business of informal sector. Over the years, we have noticed that some bank staff lack basic knowledge on digital financial service, “he said.

Olojo urged CBN and banks to put in place Agent support system in dealing with agents who are people not regulated by any institution.


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Stanbic IBTC Bank Disowns Lagos ATM Fraudster

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Stanbic IBTC Bank PLC has disowned Tope Olajide, 22-year-old fraudster arraigned for theft of customers deposits.

Stanbic IBTC Bank Disowns Lagos ATM Fraudster

The Bank said this in a statement on Wednesday.

The statement said: “The attention of the management of Stanbic IBTC Bank PLC has been drawn to news currently circulating in the media, about the alleged arraignment of staff of the Bank on charges bordering on the theft of customers deposits.

“The Bank would like to clarify that the defendant, a 22-year-old Tope Olajide, IS NOT, and was at no point in time an employee of Stanbic IBTC Bank PLC.

“The alleged culprit was apprehended around 7:30 am, on Thursday, 27 August 2020, by security operatives after he was exposed by CCTV footage using ATM cards he had allegedly stolen and converted, to make withdrawals from the accounts tied to the stolen ATMs.

“The CCTV footage also showed the alleged culprit pretending to assist customers at ATMs whilst also attempting to fraudulently dispossess the customers of their ATMs.

“He was subsequently arraigned before an Ikeja Magistrate Court on Monday, 14 September, for stealing the debit cards of two customers and using them to unlawfully withdraw the sum of N427,000.

“The Bank would also like to implore members of the public to be security conscious when conducting transactions at ATMs. Customers are advised to report any suspicious actions around them to security operatives who are usually stationed around the Bank’s ATMs, when carrying out transactions at any of our ATM locations.

“As an organisation, we hold dear the values of integrity, and we will continue to prioritise the safety of our customers effectively.”


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Buhari Okays Establishment of CBN-Led Infraco

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President Muhammadu  Buhari has approved the establishment of an   Infrastructure Company (Infraco) to be driven by the Central Bank of Nigeria (CBN) in partnership with the African Finance Corporation (AFC) and the Nigerian Sovereign Investment Authority (NSIA).

Buhari Okays Establishment of CBN-Led Infraco

Mr. Godwin Emefiele, CBN governor

This is coming  on the heels of the foreign reserves’ slump to $36 billion following a cocktail of monetary policy interventions by the apex bank to cushion the scathing effects of the COVID-19 pandemic on the economy.

Mr Godwin Emefiele, CBN governor, made these disclosures in Abuja at the annual conference of the Chartered Institute of Bankers of Nigeria (CIBN) with the theme: Facilitating a Sustainable Future: The role of Banking and Finance.

According to him, Infraco would enable the use of private and public capital to support infrastructure investment that will have a multiplier effect on growth across critical sectors.

“This entity would also be able to raise funds from the capital markets and mobilise long term finance to address some of our infrastructure needs, while providing reasonable returns to investors. “We believe this well-structured fund can act as a catalyst for growth in the medium and the long run. The support of the banking community will be important in achieving this objective.

“A well-built infrastructure system, comprising hard infrastructure such as roads and ports, and soft infrastructure such as broadband penetration, can have a multiplier effect on growth by enabling the expansion of business activities in the country”, he explained.

On foreign reserves, Emefiele attributed its crash to the decline in foreign exchange earnings and subsequent adjustments in the value of the naira to the dollar.


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Amana Bank signs Comprehensive Software Deal with Path Solutions

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Amana Bank, a leading Islamic bank in Somalia has announced that it has selected iMAL, the AAOIFI-certified core banking platform from Path Solutions to replace its legacy IT system and deploy a single, cloud-based digital banking platform to underpin its banking operations.

This is Path Solutions’ third win in Somalia after Premier Bank and MyBank Ltd. The company went through a lengthy competitive bidding to which all international suppliers were invited, before being selected as Amana Bank’s preferred technology partner.

According to a statement following the signing, Path Solutions will supply and install its flagship Islamic core banking platform iMAL in addition to its comprehensive digital suite at Amana Bank Somalia. The new digital software will provide instant 24/7 service availability with fast, inexpensive, easy and convenient online banking, frictionless payments and transfers, personalization, engagement and retention.

Abdirizak Hussein Malin, Chairman of Amana Bank Somalia commented, “As part of our strategy, Amana Bank has instituted a digital transformation plan that will help us meet the emerging needs of our customers and the increasing demands of innovation.

“Consequently, we required a partner with open and agile technology that will drive powerful change. We have chosen Path Solutions for its ability to deliver vital digital financial solutions at this critical time with its depth of experience supporting Islamic banks in Africa.

“The company has differentiated itself from other vendors in its unique ability to combine core Islamic values with modern digital banking solutions, and to fully comply with Sharia and banking regulations.

“We are confident that the new technology, proven to significantly improve levels of customer fulfilment, will transform our operations by driving incredible efficiency gains while also reducing risk, lowering overall IT costs via higher automation and lower maintenance spending”.

The new iMAL platform leverages artificial intelligence and machine learning to help financial institutions get predictive insights for better data-driven decision making. It will also help strengthen customer loyalty through enhanced security transactions.

“We are delighted to partner with a leading Islamic bank in Somalia on a project that will set a new standard in digital banking for the country. Today, every financial institution has an incredible opportunity to apply advances in cloud computing to redefine every aspect of its business”, said Mohammed Kateeb, Path Solutions’ Group Chairman & CEO.

“Somalia’s Amana Bank is a good example of this transformation to drive innovation forward and ensure much more secure banking experience, enabling customers to enjoy the nuances of non-stop banking with cloud-based services.

The bank will also benefit from the full Islamic coverage which bridges the gap between modern customer requirements and intrinsic Islamic values. Our multi-award winning Islamic core banking platform will support the delivery of innovative digital products that are both Sharia-compliant and specialized for Amana Bank’s retail and corporate customers”.

The new agreement was signed by Amana Bank’s Chairman Abdirizak Hussein Malin and Path Solutions’ Group Chairman & CEO Mohammed Kateeb on Sunday 6 September at Path Solutions’ Dubai office. The implementation will be delivered 100% in the cloud and 100% remotely amidst the COVID-19 lockdown.


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