Where are these 37 Million Ghostpreneurs in Nigeria?

The ongoing revolution in payments, automated credits, and self-service onboarding that have fueled massive growth in digital banking over the last 3 years seems to have largely overlooked the Nigerian Micro, Small and Medium Enterprises (MSME) sector. Forget whatever anyone says, the small business owners have been left behind.  Who did they offend?

At a recent event, I touted the numbers from SMEDAN that Nigeria had, as of 2013, 37,067,416 MSMEs, someone almost stoned me with her stiletto (with wicked looking pointies that could be deemed a weapon of personal destruction) because the numbers just didn’t look real.

Or are they Ghostpreneurs?

The numbers didn’t add up for me as well. Where are these companies or micro-enterprises? Finding them is hard. I mean, every bank will tell you that 7% or less of its accounts belong to non-individuals. When you look at NIBSS June 2017 figures, corporate accounts are just 6.5M out of the 98M accounts strewn across 20+ Nigerian banks. And the 98M accounts belong to about 26.5M accounts which average about 3+ accounts per individual. And by the way, over 98% of account holders have accounts with more than one bank.

Something doesn’t add up.

Of course, it was easy to see. Many of the MSMEs run their businesses with their personal accounts, so they are probably not Ghostpreneurs. So Sisi Clara Cake and Thingz, Baba Bisi Furniture Works probably run off their personal accounts with Bank A and B. Would you have thought they love it that way? Maybe not.

Until recently, opening a personal account in Nigeria was one of those rites of passage where you must pull a tooth with rusty pliers, by yourself and without anesthetics. Calling it painful and sadistic would be an exercise in understatement. The good thing is that over the last 2 years, the self-service revolution has extended from digital services to account opening.

At first, banks streamlined their account opening packages, so you won’t have to write GMAT essays just to open your Savings Account and then naturally progressed to opening accounts online. Now, practically all forward-looking banks allow you to open accounts online or via USSD. Unfortunately, what you get is a basic Tier 1 account and to upgrade to a proper account you can live with, a trip to the bank branch is still required. Alat by Wema has done a good job though – you get to open a proper account 100% online, and even your debit card is ferried to your shanty free of charge. I hope others see the light!

However, opening a business account is still an exercise in morbid self-flagellation; no bank seems to get it right. They ask you for all types of documentation, like what tribal mark your dead great grandmother had (you never met her!). They require random documents from fledgling entrepreneurs, who can barely put together their business plans. Many of these documents require pilgrimages to dens of government agencies. Ultimately, unless that account is critical, most entrepreneurs use their personal accounts to run their side gigs.

Think about it, have you ever paid your friend that does small chops as side hustle via her company account?

The lack of ease to open a business account has been a lose-lose-lose for every single stakeholder.

Not having a business account, in the company name, means a small business will never be able to scale. I mean, do you think Shell or Mobil will give you a small supply contract with a personal account? Absolutely not. Furthermore, by the time the small business eke out some semblance of progress and a business account is opened, the company is locked out of valuable business loans because the new account would not have the financial history that has been lost to the founder’s account.

The efforts of different banks, especially Diamond and Fidelity Banks (Disclosure: I worked at Fidelity Bank), would continue to be hampered if the ease of business account opening is not addressed.

The government also loses because taxes are lost when revenues for companies are sunk into individual accounts. The government is also not able to have data to track the performance of MSME initiatives, and they are not able to drive grants to sectors in dire need of one (I dey try myself, I know!)

What the MSMEs need today is a bank, beyond the rhetoric and adverts, which can automate the account opening processes. If an individual does not need to worship at a bank branch to open accounts same should also be extended to MSMEs. A startup should be able to start the process, upload all documentation and have an account opened within minutes or hours at most. There are APIs, tools and other offline services available banks to authenticate almost all documentation required for business account opening. Each director or signatory in the account would also be part of the process and can be validated as well.

I honestly believe this would happen as soon as the market for individual digital payments reaches maturity. However, between now and then, the first banks to streamline this process may have a lockdown on MSME business accounts.

Getting my Clones to do the Work

If I could clone myself into 5 other annoying DejiOlowes, today would have been the day I would place the orders for new mes.

I woke up this morning not wanting to do anything, but hey, I have to work – else I won’t be able to get food on the table. But come to think of it, what if I had clones, they would have gone to work, slaving their miserable lives on my behalf while I get on the next flight for a late summer vacation.

Who could resist such?

So what if I could clone 5 of me, what would they be doing?

DejiOlowe1 would definitely be going to work. I mean, he needs to hustle for the money all of us would spend. He would be warned to behave himself, not get distracted, no drinks after work and just be a chilled dude. In fact, he would clock in more hours a week than Elon Musk.

DejiOlowe2 would be the nice dude, working the phone; calling family and friends, visiting relatives and doing charity work.

DejiOlowe3 should go back to my first love – researching medical devices and esoteric stuff. He may get back to the Ph.D. that I abandoned in 2011. There was also an abandoned photonics experiment that he must pick up and finish. Oh, I forgot about the meta-genetic algo optimization that he has to work on as well.

DejiOlowe4 and 5 would start a startup together. Not sure what they would do but hey, they better get going because they need to make a humongous amount of money for all of us to spend down the line.

If only I could get an extra DejiOlowe to be working the gym while the real me gets 6 packs, that would have been the icing on the cake. Drooling.

And the real me? Probably lounging around, I will control the bank accounts and I set spend-limits for the other hapless DejiOlowes. If 4 and 5 do a good job, then I should travel the world and visit all the exotic places I have always wanted to go. Bora Bora tops the list.

Damn, I need to get out of bed!

Your Friends Reflect Who You Are

On a bright Wednesday morning, the Chemistry teacher herded us like recalcitrant goats into the Chemistry lab, handed over the second term Chemistry exam sheets and asked each of us to call out our scores so that he could tabulate them. Everyone called the usual numbers; most got Bs and As. When it was my turn, my tongue felt like lead. I walked up to the teacher timidly to complain in the lowest cat meow voice I could muster (so I won’t have to shout out the impossible number).

I got 45%. Never felt more ashamed in my life.

Growing up, I wasn’t a particularly bright kid; but because I was inquisitive, everyone felt I was smart. I could wing my way around; but since I was also supremely lazy, it was mostly misses than hits.

After the unfortunate event in my SS2 (year 5 of high school), I went groveling to my two good friends for help. These guys were freaking smart, not kidding. Femi Gbonjubola was the king of Chemistry and Physics. Femi Olajide lorded over Further Math. They taught me Chemistry like I was a toddler.  A few months later, I did my General Certificate of Education (GCE) and got a few As and that was it. Life was made!

So, what was the point of that story and why should you care?

You can’t be better than your friends

Your friends are an indication of what you value, and you can never be better than them. Psychologists and sociologists have done tons of researches on peer pressure and mob action. Everyone knows the company you keep can push you to greatness or infamy.

Friends affect your career and success more than prayers!

Growing up, I was lucky to be friends with people who took pride in challenging themselves to get better grades. That progressive rivalry made everyone to sit up, and it helped.

But then I remembered old schoolmates who didn’t care about grades and just wanted to wear the latest designer labels and shoes. Unfortunately for those old school mates, trying to be the social bee and getting bad grades seems to have a strong correlation.

But then, if your friends are the happening types and they network a lot professionally, hanging out with them increases your chance of bumping into a beneficial contact. Some of those serendipitous encounters have transformed lives significantly. Of course, if you have no friends and you hide at home after work every day you may not go far!

On the flip side, if your friends are the lau lau type, spending beyond means to impress everyone; raking up debt to buy business class tickets to watch Champions League when bills are crying to be paid, the end is usually not very good.

Ditch your friends; they are no good!

Do you have a friend who seems to have a negative attitude about life? He never sees the good in anything and always talking about how life is unfair; the weather is shitty, Donald Trump is the president of America (wetin concern agbéró with overload?), etc. Dump him; he’s no good!

Is your boyfriend insecure about your progress and always dissuading you from reaching your goals? Is he always preaching the how a woman should behave and must be seen not heard? (Fake preacher). Jilt him! There are too many good guys out there than for you to sacrifice your life to a sorry ass you met just four months ago.

If your friend doesn’t know how to save, is always envious of rich folks, loves to put up appearances, borrows money for parties…get LAWMA to take him out of your vicinity. He’s worse than dirt.

If any of your friends or side chicks wear fake designer labels or carries fake designer bags, dump them fast. The inferiority complex will rub on you the wrong way

If your friends don’t treat their drivers, house helps, office assistants, etc. with respect, run from them. It’s easy to know the values that people carry within them by the way they treat those less fortunate. You don’t know your friends until you have gone through a misfortune or two.

Choose your friends like you choose your underwear

I know some people are annoying, but if they have good values that you admire, choose them as friends or mentors. The positive attitude they impact on you would transform your life.

Pay attention to those who respect others and are considerate. Be close to very ambitious and driven people but want to use only legal means to achieve them.

If your friends love to read and be up to date about their environments, even if you fight, don’t lose them! They are worth more than their weights in gold.

Hang out with those who have self-confidence and let them boost yours as well. Many smart people have lost good opportunities because they were too self-conscious to seize them.

My friends are my heroes

I wouldn’t be where I’m today if those two scallywags, Femi and Femi, didn’t teach me Chemistry. It gave me the confidence to tackle the other subjects, and here I’m today, I finally got to be an electrical engineer (don’t ask me to fix your light though, we could both get electrocuted)

Femi Gbonjubola, unfortunately, left us Christmas day of 2002. Femi Olajide, on the other hand, has devoted the rest of his life cleaning dirty teeth and improving public health all over the world.

May you never lack good friends!

Dropbox banking: The backbone for Fintechs and a probable model for banking in the future

The argument about if Fintechs and Banks are frenemies would never end. And it’s justifiably so.

Retail banks have a model of providing checking, savings, investment account services. Of course, they layer that with credit cards, personal loans, mortgages, etc. Fintech showing up on the scene means one thing, banks would be losers. There isn’t any clearer way to say it.

Think about it this way, banks earn money from these services and would want to continue that way. Fintechs showing they could do it better means they also want to gain something as well. So, any of these could happen: banks would lose, and Fintechs could gain; Fintechs and banks would gain from increased service cost and customers would pay more; Fintechs would lose, and banks would be cool.

There is also the friction that comes with who owns the customer experience. Most banks loathe to see new players sandwich between them and the customers and would prefer to control every single data point. On the flip side, when customers start to use apps for Personal Financial Management and their bank accounts, they start seeing the banks as a repository of their funds or provider of loans.

Retail banks don’t even trust Fintechs as their services tend to aggregate and disintermediate. None of the banks want to be a bucket for storage.

But wait, why not?

The traditional model makes losers out of the retail banks for Fintechs to win, maybe the only way would be to have a new type of bank, modeled from grounds up to take away the arguments of retail banks.

So imagine a bank, fully licensed but whose interaction is via APIs that Fintech and others can use to connect to it. Fintechs are the actual customers because the banks help them to hold their customers’ funds and loans in compliance with the regulation.

Dropbox was happy to become the programmatic storage for many apps, and that cemented its position in the world of cloud storage. Of course, Google Drive, Box, Microsoft OneDrive, etc. support the same approach but nothing represents personal commodity storage more than Dropbox.

A bank, fashioned after Dropbox, could have the same model and would face no pressure to compete with Fintechs but be the backbone for them. Such a bank, with no direct customer interface, would be barebones to run with the most minimal of operational overhead.

Could this be a viable model?

If this model works, then it’s possible that the future of banking will be the gradual transformation to the utility company providing services to the Fintechs who will own the customers. Nevertheless, there may not be a total elimination of the traditional model though, or one where all banks become a full-scale utility.

The harsh reality for Fintechs is that banks still own the customers’ trust for now and that counts for a lot.

Being a utility player offers no room for differentiation, and it simply becomes a case of the best bank offering ease and variety of API integration (across the various requirements of the Fintechs – Risk and Regulatory Compliance – i.e.  KYC, AML, security of deposits, etc.).

What is likely to happen is more of a gradual acceptance of the Fintechs services as options for customers in areas where the banks may not have the capabilities. For example, Santander is selling SME lending via Kabbage or providing Personal Financial Management via Meniga, The ultimate Fintech bank that will provide an integrated suite of all the customers’ required financial services may just not be on the horizon yet.

But it will be interesting to see how this pans out for the future of banking.

#Note
Contributions from Ladi Asuni

Multitasking is Good, Focus is Even Better!

I almost freaked out when I found out that I could cut steel and concrete with just a bottle of water, or simply by shining a torch light. Wait, with my bottle of Nestlé PureLife, I could cut down the Eiffel Tower?

Ok, I know that sounds dramatic and impossible, but the real gist of this is that you can cut steel or concrete with a water jet or laser. It sounds like science fiction, but that’s the power of focus.

Taking it further, I remember a very razz proverb from my grandma that says that you can make your pee foam – if you aim it at just one spot.

Science fiction or razzness aside, there is so much you can achieve in life and your career – just by the power of focus. It allows you to put together your mental, financial, and professional energy on what is imperative. Hopefully, you can have the superlative success that nobody would have imagined you are capable of.

The power of focus also goes into the everyday things we see around us. Think about how a small push of the brake pedal can stop the humongous SUV we are using to harass innocent Fiat Punto drivers on the roads. The little force from our spindly legs is multiplied by focusing it on a small area of the brake mechanism.

So it boils down to this: if you are trying to do many things at the same time, you may be praised as the master of multi-tasking, but the chance is pretty high you won’t achieve anything.

How this affects your career and your life
I once mentored a young woman. Bright and intense nonetheless, she was never able to break into the big league because of a major problem – she wanted to do so many things. From project management certifications to doing ACCA (sorry, accounting sucks), to running a hair salon side gig. Ultimately, her attention, energy, and intensity stretched thin. It was simply not enough to achieve success.

So, if you need to have a transformation that lasts and gets you there, the first big question would be – what would you rather be successful in… if you had just one chance?

Unfortunately, it’s hard to find an answer to that deceptively simple question easily. No wonder it has been hard to be successful as well. Sad.

So let’s say you are one of the few who knows what they want to be, the next thing would be to focus on it like a religion. Act like your life depends on it. The focus does the magic!

Run the distance
Focus is magic; but every magician will tell you, if you don’t have the crowd, you don’t have the magic! You need to run the distance for the focus to show its effect.

This reminds me of the few times I did some sit ups, then I gingerly touched my pouch, feeling for anything that looks like the start of a six pack. Of course, once I fell off my schedule after a few days, only the one pack stayed behind.

Simplification is deceptive
Before sauntering into the evening, I need to warn you that simplification is a façade. Yes, you need focus, and then you need focus to run the distance to achieve anything. Errm, that isn’t all to succeed. You need to run smart; you need a dose of luck.

Gosh! We need many things just to get a chance to succeed.

Online Banking without Offline Annoyance

The drumbeat for payments and all things digital has been beating loud and long (and annoying, almost like a banshee!). At face value, this seems to be one thing customers and banks can agree about.

Banks don’t want customers in the branches anymore (because it cost more to serve them in-branch) and customers don’t even want to go to the branches to do transactions. It cost more to get there; the tellers aren’t as pretty as before; you could spend the last years of your life stuck in traffic and lastly; woe betide you if your favorite branch got robbed, a junior thief could use your pot belly for target practice.

Unfortunately, while it seems there is an agreement, almost every bank seems to struggle with getting customers online.

Many issues are to blame.

The processes are designed by sadists who don’t understand what customers want or able to even let the customers know what needs to be done online.

Even when the processes can be decrypted by the CIA and NSA, it mostly involves a trip to the banking hall.

But then, good news is, sadists are getting a change of heart and banks are seeing the light. Hallelujah.

Curiosity killed the cat

In the age where Zenith, Wema, etc. let you open an account with your USSD code, I was wondering if these banks won’t let me have internet banking without seeing their shops. So huddling with a friend, we trolled banks to find out the current processes of getting customers to register for Internet banking (hey, we didn’t touch mobile, don’t beef!) and whoa, we have an intriguing result.

Summary

Out of the 21 banks surveyed, 57% or 12 of them allow you to start and end your registration for online banking. However, most would want you to view just your balances. You must still ferry your backside to a branch to get token.

Of the lot that really understand the perspective of the customer, 50% of them allow you to complete the end-to-end enrollment and start doing transactions without any branch visit. Kudos to their product management team – you guys have balls!

Full Data

BankEnd-to-end self-enrollment?Self-enrollment allows transactions?Authentication method
Access BankYesNoValid account number to register; an activation code is sent to registered email and mobile number via SMS
Diamond BankNoNot applicableDownload and fill form and submit at branch
EcobankYesYesValid account number to get OTP via SMS
FCMBYesYesUse valid account number, use Debit card information to validate
Fidelity BankYesYesUse account number to get OTP, fill online form, use debit card information to validate, download a token app and start doing transactions.
First BankNoNot applicableCall FirstContact to begin registration or visit a branch
Guaranty Trust BankNoNot applicableDownload and fill form and then submit at branch for activation
Heritage BankNoNot applicableRegister online, print and take to branch for activation
Jaiz Islamic BankNoNot applicableDownload and fill form and then submit at branch for activation
Keystone BankNoNot applicableDownload and fill form and then submit at branch for activation
Providus BankYesUse valid customer ID, OTP sent via SMS
Skye BankNoNot applicableRegister online, print and take to branch for activation
Stanbic IBTCYesYesUse valid account number and phone number; set up secret questions, OTP is sent via SMS
Standard CharteredYesYesUse Standard Chartered ATM, Debit or Credit card information to validate to get OTP sent via SMS, alternatively get

Temporary ID (Received via Email)
Temporary Password (Received by SMS)

Sterling BankYesNoUser valid account number and Phone number
SunTrust BankYesUser customer number, identification number, e.g., Passport or National ID card, date of birth and branch name
Union BankYesNoUse valid account number to get OTP via SMS
United Bank for AfricaYesYesUse Valid account number, use Debit card information to validate, use OTP to consummate instant transactions
Unity BankNoNot applicableDownload and fill form and submit at branch
Wema BankYesNoUse valid account number
Zenith BankNoNot applicableDownload, complete, and submit request form at any branch or via email

TGIF but one last thing

I know the stories won’t hit the headlines but banks still get shafted, once in a while, by fraud. However, I’m very sure that the ease of onboarding, the rapidly ramping revenue from transactions and even the demand for modern banking would force everyone to be at parity within the next 2 years. Mark my word, time would come when the last bank to get onboard self-enrollment would be beaten up by the horde of irate customers.

Get your private email, with custom domain, free!

Whether you are bootstrapping a small business, fought your boss and launching into the deep on your own or just side-hustling, there are some key things you need to do so people can take you seriously.

It could also be that you have a political activist group or running an NGO for orphans (I’m one, please help me!), you still have needs for certain work tools.

Having your domain name for your emails is sacrosanct if not people will think you are a joke. If you don’t think a custom domain email is important, trust me; you are probably a joke. But when Google Suite and others cost about $5 per user per month, being a joke could be less evil.

For small companies and NGOs, cash is always hard to get. And if you happen to be in Africa or especially Nigeria, many of the services you need: such as emails with your domain name, file hosting, etc. would be priced in US Dollar, something so rare to get these days. As rare as pink elephants.

Recently, while working on a project, I bumped into Zoho Mail, awesome email service but with a twist; there is a free plan!

With the free plan, if you can register your own domain name ($10 per year), you can get up to 25 users with 5GB of space for each of them for free. Your own myname@myfancydomain.com! As space is limited to 5GB, you won’t be able to keep a lot of junk in there. But then who cares? After all, once you have landed the big project and your magas have paid, you can always upgrade to the paid tier.

Years ago Google allowed anyone to create customer domain for up to 50 users free and then gradually reduced it until it became zero. This is how we host our Olowe.com email. Microsoft did the same thing with Outlook.com but bad belle people; they offered 500 users and then yanked everyone off!

By the way, if you are as vain as me, and you want your own myname@mysurname.com type email, Zoho Mail free plan will be OK for you, your siblings and your parents (if you still have them around). Being your family email administrator should make you relevant for the first time in your life; the feeling is awesome!

Getting them high: Challenges of onboarding customers to digital services

Digital services, which include cards, online banking, mobile apps for finances, USSD for transferring money you don’t have, etc., are essential services. In fact, financial inclusion has been elevated to the level of fundamental human rights. However, unlike things we derive joy from using – Whatsapp, Tinder, Facebook, to mention a few, digital services are like toothpaste; nobody gets too emotional about them – you just want them to be affordable, available, easy to use and then get them out of the way before you lose your mind. That is if you have a mind to start with.

Challenges facing purveyors

But then, the horror eating at digital bankers, the unloved purveyors of FinTech (Ok, I want to stop using this buzzword, it’s no longer cool) products and other financial thingamajigs, is the low onboarding or usage rate despite a captive market. When I say captive market, I’m talking about banks with large customer bases but whose customers just don’t sign up for electronic services. You would think customers love going to those crowded and nightmarish banking halls. Hell, freaking no! They continue to complain about having to visit branches to get things done. To make matters worse, even the tellers in the branches aren’t smiling or friendly, so what’s the point?

What customers want

I know quite a bit about what customers want with digital services because I’m one of them. As crazy as it sounds, I’m a customer, so I’m speaking for the hordes of ill-served and hapless customers.

The average user isn’t a techie, but yet products and services are designed such that you need to be a professor to figure things out. How to get the products is never clear; the screen flow is more complicated than flying a space shuttle, and the error messages leave you scratching your head. I can imagine how hard that is going to be for bald customers. For example, the password instructions about using special characters, upper, middle and lower cases, etc. can drive even the most patient Moses impersonator to tears. Why can’t I choose a password I’m more comfortable with? After all, if I use a complicated password and my money gets stolen, the bank still won’t be doing a refund.

By the way, using passwords such as Password123, for example, is like painting a big fat red ‘X’ on your back and then taking an evening stroll through a war zone.

Customers want convenience so asking me to visit a branch to request internet and mobile access is just, pardon my language, insane. Until someone explains why Facebook and Whatsapp never set up offices to sign up users, but my bank has to force me to endure the unfriendly Customer Service Officer, I won’t ever understand this. The pseudo-professionals talk of security and risk management, I only see mental laziness. While the risks have not disappeared, banks have launched USSD services, virtually all via self-enrollment, and the world is yet to end. Why the same approach can’t be used for all other electronic services baffles me.

My accounts have simple ten digit numbers, but the various digital banking services require different profiles and credentials. The multiple systems don’t talk to each other or even know my preferences. Does it make sense to have a different username and password for the internet and mobile services? Why can’t I manage my cards within these applications?

And the most annoying thing ever? – Even after I have taken Keke Marwa to visit the branch, endured the overzealous security guard, prayed through 10 chapters of Psalms that the branch doesn’t get hit by robbers on the day I visit, complete a form that stretches over a thousand pages, made to fill all my information over and over again, sign in 10 different places and then, oh, the customer service officer says “you have to come back to get your token as we have to make a request to head office.” Darn it!

Why digital initiatives and products have failed

Of course, customers aren’t idiots, so they rebelled against the products, come to the branches to cause trouble and continue to add to the blood pressure of digital bankers when they have to explain their weak numbers at monthly performance meetings.

My opinions on why things failed are few:

It starts from the top. Senior management and executives don’t understand the retail customers. In their rarefied offices, they practically get everything done for them. If you don’t walk in your customers’ shoes, you can’t get things done for them. In fact, let’s take a bet; if you work in a bank and 50% of your senior management use digital products regularly, I’ll give up my salary for next month.

Many products are developed by techies, who obviously have orgasms making complex products than serving dumb customers like me. The world has moved beyond digital products being hobbyist items; experts in customer experience and human computer interaction need to work on the flows and processes that are simple and a joy to use. Banks and FinTech (oops, I used the word again!) have to start doing product management and not product delivery.

Risk management is essential but isn’t everything. Every business has an element of risk; if you don’t want to get bruised, don’t play games. Many of the processes and product requirements are designed by sadists who think risk avoidance is the same as risk management. Not to be hard on them, if you have ever seen a massive fraud once in your career, you could be worse than them. Trust me, EFCC cells don’t have air conditioners.

Data practice is poor, and customer information is scattered everywhere in database silos. The silo data means the customer’s phone number on the card management system is different from the one on that of internet banking; the address filed on the mobile app request form was never updated into the core banking application; the madness goes on and on.

Making life easy for everyone

It’s not all doom and gloom. The strides made by some banks, especially those leading the USSD trail (GTBank, Fidelity, Access, Zenith, etc.) have shown that when the right mindset is applied, magic can happen. The simple workflow and self-service options for USSD banking have been so successful that it has led to over 200% growth for interbank transactions in 2016 alone.

Banks should develop integrated products or make efforts to integrate what they already have. Let the ATM know that I have the mobile app; let the mobile app be able to change my card PIN (yes!), set limits and allow me to make requests from my phone.

Processes that involve branch visits should be streamlined; Forms should be designed by humans (not sadists) and for humans; requirements should be clear and reasonable.  For instance, setting up a company online banking profile, with various mandate instructions remotely, will always be difficult but not impossible. At least, that process shouldn’t be an attempt at mental genocide.

Banks should clean up their data and also implement a single-source of truth. It’s never going to be done in a flash, but the process can start now.

FinTech and banks should understand what risk management is. Instead of making things too loose (FinTech) or too hard (Banks), elements of quantitative and qualitative risk assessments should be applied, and banks should learn to set a portion of income aside for fraud and loss compensations.

Things can change

The frenetic pace of changes over the last few years is an indication of things to come. I honestly believe that many of the issues outlined above can be resolved. After all, we didn’t get here in one weekend.  Additionally, the regulatory demands of Cashless would drive the banks, financial service providers and the average Nigerian towards more robust digital services.

Fixing the PTA Palaver with Technology

There was a collective sigh of relief when the Central Bank of Nigeria recently decided to clear the backlog of travel allowances pending with banks. Nevertheless, a lot of well-meaning Nigerians could also see the opportunities for arbitrage and abuse. Of course, bad boys being bad boys, it quickly turned into a bazaar.

The Personal Travel Allowance, PTA, is a carryover of the ancient Nigerian command and control FX policies where the government, acting as the national nanny via the CBN, hands over FX at a subsidized rate of $4K per quarter. Never enough to build a mansion, yet the margins are sufficiently fat enough for anyone to do a quick deal. For example, the difference between the CBN rates and the alternative markets is about N120; that’s about N480K per quarter and N1.9M per year. Even the angels would be tempted.

Meanwhile, that’s nine times the annual minimum wage specified by the Federal Government.

Instead of looking a gift horse in the mouth by blaming the CBN, who could have turned the other way and let everyone roast with the BDCs of this world, some friends and I thought we could come up with ideas on how this can be managed with technology. Our sole object is to help those who need the FX to get them easily while ensuring the opportunity for abuse was minimized. After all, why blame the government for a poor policy if we don’t have clear alternatives.

After bashing our heads against the wall for some hours, we came up with the following:

FX Nanny Online 😊

The interesting thing with the Nigerian traveler is virtually every one of them has a bank account, and with that comes the dreaded Bank Verification Number, BVN. The BVN is probably the best invention to tame financial recklessness in Nigeria, but we are not utilizing up to 5% of its capabilities. That’s a story for another day.

To get FX for travel, the intending traveler would apply online at some random web app to be put up by the CBN. Let’s say it will be at www.fxnanny.cbn.gov.ng.

Travelers will specify the usual details: travel dates, airline ticket reference, travel document details (scanned copy of their passport), bank details, BVN, etc.

At application time, the web app will indicate the likely rate at which the FX will be sold.

The processing team can then review the application and if approved, make FX available by debiting the traveler’s account using the cardholders’ bank process. The processing must be automated, if not, it creates an opportunity for tingodism.

To ensure that abuse is kept to the minimum, travelers’ passports will be automatically validated with the immigration system, tickets checked against airline APIs, and when the traveler returns to the country, the travel records will be automatically checked against immigrations airport database (does that even exist?).

And here comes the kicker. The FX will be available to a specific prepaid card which can only be used in the countries the travelers have specified and verified via their airline tickets. Additionally, the card or FX will only be active from the date of travel and cannot be used in Nigeria at all.

Travelers will need to buy the prepaid card from any bank, or their bank, and automatically, those cards will be tied to their BVN and be available for automatic loading. They won’t need to visit any bank branch.

Anyone found to have abused the system should be banned for half of eternity and made to spend two weeks with EFCC, washing plates and detention cells.

Service could cost about 1% shared between banks, the platform provider and CBN. Someone has to keep the lights on!

Benefits to the Central Bank

  • It can finally have peace of mind and stop chasing banks around, hustling them to provide data about FX usage. That sucks a great deal.
  • The majority of PTA abuse can now be curbed. Of course, someone will always find a loophole, but that can be addressed when CBN gets to that bridge. Hopefully, not River Niger Second Bridge.
  • CBN will be able to have a real-time overview of the PTA market. It will be easy to ferret out insights into which countries people love to traipse to, which airlines love PTA users, which banks are playing games, etc. without issues.

Benefits to Travelers

  • With the assurance of a level playing field and the demystification of the man-know-man Nigerian problem, the regular traveler can have hopes of a decent PTA without sucking up to a raggedy teller in a bank branch.

Benefits to Banks

  • Earn commissions from processing the debit of travelers’ accounts and crediting the travel card. Should 0.65% be a good incentive?
  • The only source of temptation which has killed many budding careers would be taken away. Trust me; bankers regularly get steamrolled for FX infraction. In fact, it’s an existential risk for branch managers.

Apparently, our solution has glossed over many key issues. For example, who is going to build the application and maintain it? Is the CBN going to be allowed by card associations to issue cards? Will it issue MasterCard and Visa cards only? What will it say to Verve, Freedom and Genesis cards?

If the site crashes or slows down, who is going to be held responsible?

What happens when a card is lost, stolen or blocked? What happens when a traveler needs to change his travel plans?

I don’t have answers to these questions, but hey, the world is full of smarties. Anyone can contribute opinions below.

 

Dreamers are losers. Ideas are worthless.

I grew up lacking so many essential things like Lego toys, common sense, understanding further math, etc. but I never lacked dreams or ideas. I had them by the dozens. After all, dreams and ideas are free and require no permission from hawkish parents or even from the government. I tucked into them and generated dreams and ideas like a real dream machine.

Unfortunately, dreams and ideas didn’t get me anywhere because everyone had them too. And the dreams were getting them nowhere. Dreams are free; ideas can be plucked from anywhere; both useless and worthless.

Sounds counterintuitive, isn’t it? Everyone says, follows your dreams! Guys with ideas are courted and loved. So why the gripe?

My rant isn’t to diminish dreaming or ideas but to put them in their proper perspectives. So before you start wondering who stepped on my toes this morning, hear me out.

Dreams and ideas aren’t constrained by physics or reality and would never be. If you ever watched Tom and Jerry, you will understand that.  Additionally, ideas and dreams are free, anyone with half a brain can conjure them up. I spent the majority of my childhood imagining myself as a superhero, and it was an excellent time – I can bet you spent yours with similar ideas.

But why are dreams and ideas so useless if we need them for innovation? Why am I valuing them down to nothing when to be called a man without a dream or ideas is worse than being called impotent? I mean, if you are not actually impotent.

There are also good and bad ideas – bad ideas being so many out there so why isn’t the good ideas worth something?

Let’s check out what happens in farming.

Send down the rain!

Rain and moisture are so important to agriculture that without it, a nation is imperiled. Just ask the Mayans, an ancient culture of South America, that was destroyed because of drought famine. But then, rain itself isn’t food! The fact that it rains doesn’t mean crop would suddenly appear in farms. For there to be food, farmers must till the ground, plant appropriate seeds and then let the rain do its job.

The value of rain to agriculture is so important that sometimes some fly planes to seed the sky with silver iodide, just like the way applying Robb or onions to your eyes let loose some crocodile tears. Gosh, I hate the kitchen!

Follow your dreams

In all the time I have spent mentoring others, I haven’t met a single mentee who doesn’t have dreams or ideas. We all have them by the dozens. What sets many back, however, is that they dream on and never wake up.

Many people find it hard to believe that dreaming itself means nothing and ideas are worthless if they are not put into use.

For example, I know gazillion friends who want to improve on their careers, yet they would never fix their CVs, network with potential employers or even take the time to understand the new roles they would love to play. That’s dreaming, and it wouldn’t amount to anything.

Not taking action to actualize dreams applies to me too – I have been talking about different side businesses that could bring little income each month. I have planned, discussed and ideated. Of course, if I don’t start it, risk my savings, it would never come to fruition and by January 2018, who am I going to blame for it?

Ideas are worthless

I recently asked a few friends who run their businesses what they could do to take their companies to the next level – I mean, who doesn’t want to achieve unicorn status. Even though I talked to them at different times, they all have the same ideas.

The sad part was, none was putting any of those ideas into action.

We complained about customer service in banks – for any banker reading this, do you know any bank who doesn’t tout customer service as a strategic imperative? Every bank does, but not every bank puts it into action. What a meaningless exercise.

The Conclusion

Dreams and ideas are only useful when combined with action and purpose. Do you want to be successful? Stop dreaming, start acting on the few nightmares you have had, and even the sky wouldn’t be able to contain you – just ask Elon Musk at SpaceX.