By Babajide Komolafe
United Bank for Africa (UBA) Plc believes it is time for customers, particularly small depositors, to fully embrace self-service electronic banking services.
The bank, however, reasons that this change might not happen except some measures are applied to compel it. Consequently, the bank introduced a new minimum opening balance of N25,000 effective July 1st.
Customers with less account balance, according to the bank, should migrate to either a mobile banking account, which is self-serviced through U-Mobile, a suit of electronic and mobile banking services offered by the bank or any of the other electronic banking channels of the bank.
In other words, the bank is telling its eight million customers that if you don’t usually have up to N25,000 in your account and/or if the volume of transaction per time in your account is less than N25,000, you don’t need an account that you have to operate by visiting the bank’s branches, what you need is an account that you can access and operate from anywhere, anytime with little or no contact with personnel of the bank. That is why the bank introduced and offered U-Mobile.
Of course, there are exceptions to the N25,000 minimum account balance. According to the bank, Salary/Pension Accounts whether Savings or Current, Overdraft/Facility-linked Current Accounts, Loan Accounts, Savings/Current Accounts linked to Deposits/Investments, Para-Military/Military/Ex-Servicemen Accounts are exempted from the new minimum balance requirement.
Also, cheques drawn on all current accounts which will cause them to go below the N25,000 minimum balance will be honoured and an auto alert generated and sent to the affected customer’s mobile phone and email, with the information ‘the below N25,000 account balance” and an advice to regularize.”
Expectedly, this daring move by the bank has been strongly criticised by members of the banking public. They believe such measure is an attempt to take banking away from the reach of small savers and the masses. Some even allege it is a deposit mobilisation drive to shore up the liquidity position of the bank.
Kennedy Uzoka, Executive Director, Resources, UBA, however, disproves these claims. He said on the contrary the new minimum account balance initiative is based on management’s continuous efforts to improve on customer service delivery in the bank.
“This decision is motivated by our desire to serve our customers better. We want to significantly improve customer service and optimize our resources,” he said.
He said that though the new minimum balance is not a policy of the Central Bank of Nigeria (CBN), it is, however, in line with the objective of a cashless society; it will encourage the migration of customers that cannot maintain the minimum balance to card products, thereby guaranteeing increased patronage and use of card products in the build up towards achieving a cashless society.
This measure, he said, is a demonstration of our commitment to providing world class financial services to our esteemed customers. It will significantly improve the customer service of the bank by freeing up the bank’s relationship management staff to deepen customer relations, with a view to ensuring customer satisfaction.
It is an opportunity to increase share of the customer wallet and improvement in the performance of our service delivery infrastructure. Most importantly, with the alternatives provided, it would deepen the customer base of the bank, take banking to the grassroots and enhance cashless economy.
The above, the bank intends to achieve as customers embrace its self-service electronic banking channels namely: U-Mobile, AfrTrade, AfriCard and AfriCash.
With U-Mobile, the customer will have a mobile account called U-Mo, created with his/her telephone number. The customer operates the mobile account through his/her phone and can perform a range of banking transactions.
It is the product of the bank’s partnership with Afri-Pay Limited, a mobile payments service provider offering mobile financial services to the unbanked and banked population across Africa.
“U-Mo is an instant account opened on your mobile phone with just your contact details and mobile number. U-Mo then allows you to do banking transactions with your mobile account anytime, any day,” said Luqman Balogun, Divisional Head, e-Banking, UBA .
“The introduction of Mobile Banking Service, U-Mo, is another way UBA plans to bring banking to most Nigerians especially the semi-banked and un-banked population,” he added.
Speaking further, he said with U-Mo, the customer can save money, send money to any mobile. pay with mobile, pay bills, buy airtime credit, withdraw and deposit at any agent and UBA branch.
He said U-Mo has a lot of benefits which makes it very attractive to customers than conventional bank accounts. These, he said, include zero minimum balance, no maintenance fee, no transaction fee for airtime credit, no COT, free SMS notifications for every transaction, and free online access to your account.
Explaining the rationale for introducing U-Mo, Balogun said, “About four years ago, UBA identified mobile channels and has since been developing the mobile money capability as a critical path to delivering retail banking at lower cost and to drive financial inclusion.
“In the industry today, UBA has one of the best Information Technology risk management framework and capability to deploy mobile banking across its operations in Nigeria and the rest of Africa.”
He said that U-Mo is UBA’s version of mobile money to drive financial inclusion across the country and will be launched in other African countries where it currently provides services to its customers.
He said U-Mo mobile money solution will be deployed on the platform of Afripay as a vehicle to reach other African countries.
He explained further that the product is very versatile and does not exclude any customer irrespective of the type of phone or service provider/carrier. “The UBA/Afri-Pay solution currently allows a customer to access the service via various technologies,” he added.
This sounds laudable. But customers would have to make their choice, which is either to remain with the bank and embrace these self-service channels or look elsewhere for their banking needs.
Should the bank succeed with this audacious move, it will be a big boost for the proposed cash limits of the CBN and a signal that Nigerians are ready to depend less on cash.
But should the outcome be otherwise, it would confirm the proverb that says, “You can only force a horse to the river, you cannot force it to drink water.”