Customers accuse banks of connivance
Why we short-load ATMs – Bank official
BCAN calls for investigation
By Elizabeth Adegbesan & Blessing Akinsanmi & Deborah Ariyo
Only about 60 per cent of banks’
ATMs (Automatic Teller Machines) dispense cash regularly in the banking Lagos areas, Vanguard MoneyDigest investigations have revealed.
While most bank branches visited have average of five ATM points, the investigations show that most of the time only three of the machines are loaded with cash or are functioning, a development some bank customers believe is deliberate and intended to compel patronage of PoS (Point Of Sales) agents, located close to bank branches.
Sharing his experience on ATMs with Vanguard MoneyDigest, Adeji Oluwaseyi, a customer of one of the old generation banks, said: “I discovered that the banks deliberately refuses to load the ATM with cash just to make the bank customers patronise the PoS people so that they can make more money for the bank. But I also discovered that many PoS are not well stocked with cash knowing fully well the numbers of customers that patronise the ATM.
“I discovered that because those ATMs are not fully stocked with money, most customers, when withdrawing money, due to the long queue, they come close to themselves to the point where your secret PIN is exposed to the person behind you. That can encourage banking fraud.
“Another thing I discovered about ATMs, is that only two of most of the machines installed in the banks, which are sometimes within the ranges of three to five terminals, dispense cash. The rest are not regularly stocked with cash or are having network downtime and the bank will not come out to solve these problems.
“Another point is that most security guards that are in the banks take advantage of the situation to extort money from people. Instead of guiding people on how to use the ATM properly, they are bargaining on what customers will give them in return for rendering help.
“These are some of the things I see as problems with ATMs and I wish banks can correct them so that we can have an effective and efficient banking system.”
On her part, Model Ajuzie, a business woman, said: “During the last yuletide season, so many ATM points didn’t dispense cash and this caused a lot of problems for people as some became victims of PoS fraudsters.
“Also, I must say that it is appalling that a country like Nigeria has PoS centers operating directly beside banks.
“This is not funny but a show of how the banking industry is gradually losing its credibility. Nigerians can no longer retrieve their hard-earned money without being exposed to dangers and I think it’s time the government, especially the Central Bank of Nigeria, CBN, call for a proper overhauling of the system or even sanction these banks.”
On her part, Miss Osamudiame Mary, Chief Executive Officer of Empress Makeover, said she doesn’t use ATMs as she cannot endure the long queues before accessing cash.
“I prefer using instant transfer or PoS to make cash withdrawals and deposits. The ATMs in banks are always congested. How can I wait for hours in a queue because of a withdrawal of N10,000.
“The banks are not even helping matters. They load one ATM out of three, and the branch is the only one in that area. All its customers will assemble on that branch to withdraw, which results in the large crowd you see at ATM points.”
Why banks short-load ATMs
However, a Customer Service Manager in one of the Tier-1 banks, who spoke on condition of anonymity, disclosed that banks deliberately load few ATMs with cash, not to promote patronage of PoS agents but to reduce use of cash and compel customers to adopt digital banking channels.
He said: “Banks don’t give cash to PoS agents. They give PoS machines to them. Agents source for their cash on their own. It is not the duty of banks to source cash for their agents. Once an ATM machine is loaded, many times, within few minutes, all the money is withdrawn by customers. So to support the CBN cashless policy, we have to load fewer ATMs so that people can use other digital channels to perform banking transactions instead of using ATMs only.
“Some bank customers will even want staff to come and load the ATMs on a Sunday morning which is not a work day.”
BCAN calls for investigation
Commenting on the ATM services, President, Bank Customers Association of Nigeria, (BCAN), Dr. Uju Ogubunka, said that while it is difficult to maintain cash, given the poor cash handling manner of most Nigerians, there is need to investigate why few ATMs dispense cash.
He said: “It is not healthy for the financial services sector and the economy as well. If such action is deliberate, it will be sabotaging financial inclusion and the financial system as well.
“The act of loading one ATM can also be to encourage people to use non-cash facilities without handling cash.
“Cash is difficult to maintain especially in the country where people are still battling to use wallets. You will see some Nigerians handling cash badly by staining it with ink, grease, writing on it and squeezing it.
“The CBN spends a lot to print money and most people don’t seem to know this.
“I don’t have any concrete evidence yet on this issue. But I think the banks should be subjected to investigation on why they are doing this. Such a situation causes congestion in the banking system. I don’t see why they cannot allow their customers to have their money.
“The danger in such an act is that it will force customers to abandon their bank accounts with a particular bank and open another account in another bank, a situation which will result in an increase in dormant accounts in banks.”
“BCAN is aware of queues at ATM stands. We had to intervene. We discovered that a general problem with ATMs is maintenance. Banks should train
people to work on ATMs so that they can work well without causing hiccups.”
Reliance on ATMs persist
While the nation has witnessed rapid increase in adoption of electronic payment channels since 2010 when the CBN introduced the Cashless Policy, reliance on ATMs for cash withdrawal have persisted.
This is reflected in the CBN’s data on electronic payment transactions, which shows persistent increase in the volume and value of ATM transactions between 2011 and 2020
Vanguard MoneyDigest analysis of data on electronic payment transactions show that in spite of the rising prominence of electronic payment channels and adoption by the populace, the volume and value of ATM transactions have continued to grow, reflecting continued reliance on the machines for accessing cash.
According to the CBN, the value of ATM transactions rose by 650 per cent to N12 trillion at the end of August 2020 from N1.6 trillion in 2011. During this period, the volume of ATM transactions rose by 347.6 million to 968.4 million from 347.6 million.
However, as a share of total e-payment transactions, the value and volume of ATM transactions dropped to 1.5 per cent and 19.5 per cent respectively at the end of August 2020 from 93 per cent and 97.9 per cent in 2011.