Crashing the Cost of Banking: The Bitter Sweet Experience

The Central Bank (of Nigeria, if you really want to know) has been at the fore-front of financial inclusion, and oh, at the forefront of cashless economy.

Obviously they decided to mash the two together.

Kudos can be given to CBN for forcefully yanking our sorry backside from comfortable banking to make things really cashless. Considering that government and regulators are not known for speed or innovation, this is extremely commendable.

So, the CBN started the cashless thingy, did a million road shows and I guess the people we hardly see, the real banking customers, complained about the cost of everything. CBN came back and said, “From December 17, 2012, thou shalt not demand for N100 when your customers use other banks ATMs again!”

What?

You see, the N100 from ATM is almost synonymous with N20 collected by Askaris. You can’t dodge it. But then it cost money, I mean real money – mostly in Benjamins, to make the ATMs and other e-things work. Nothing goes for nothing.

The NCC came around and said, “From February 2013, thou shalt not collect more than N4 from SMS sent within Nigeria.” That is going to hit the pretty backside of SMS alerts. That itself is a story for another day.

Well, the CBN is not done yet – there wouldn’t be any minimum balance any minimum balance anymore. By this time, bankers are looking around bewildered.

Ok, so where do this all lead to? Simple English: Financial Inclusion.
The reality is, the cost of banking could be a barrier to quite a number of customers. Better put, most customers. Take the annoyances – COT, minimum opening balance, minimum balance, ATM fees, transfer fees, bla bla. Customers simply run for the gates. By crashing the fees, CBN is making sure no one has a real excuse for not having an account.

I can see this game evolving over time – I expect that CBN might banish some other fees, put a max on interest that can be charged on loans, a minimum percentage that must be lent to SME (wait, what happened to that 10% of PBT to be invested in SMEs?). Some even think the days of COT are numbered.

The take from everyone is this – in the short term, there would be a dip in revenue but with rapidly growing number of customers flocking to the banks and e-channels, the revenue and potentials will pick-up. This happened in telecoms, I hope and sincerely pray it happens in banking.

Can I watch that please?

Online check-ins revolutionized air travel by letting you choose seats and meals. But why can’t we pick any movie for in-flight entertainment? Personalizing flights further would be amazing!

A gazillion year ago, you had to bribe the snotty girl at the counter to put you on a good seat. If you are snotty as she is, then you are out of luck. Trust me; you will end up sandwiched between two guys who could stink a hog into submission without any trace of metabolic conversion gene in their DNA streams.

Then some folks invented online check in. Now you could choose your seat. Then you could choose your meal. Ok, Delta invented paying to move your seat nearer the front of the plane and additional patent covered getting on the plane ahead of others.

Oh, you can even make calls on some flights now but at $5 a minute, it would probably be you saying your last good bye. Because if you were going to pay for that, how long could you talk? Poor man talk.

The screens on the popular sides are getting bigger so the movies are easier on the eyes. Sound is still poor though. Like some dinosaur gasping for last breathe.

So if I could choose my seat, select my chow, why can’t I just select all the crazy movies I want to watch on a flight? Maybe porn won’t be allowed but someone should be able to get Basic Instincts in between the list. I could select my magazine too or maybe my music selection. Can I tear off the screen and read/watch off my laps?

Poor Support and Initiatives from Payment Gateway Providers Kills ECommerce in Nigeria

My experiments with Magento and OpenCart revealed a lack of modules for Nigerian payment gateways, hindering e-commerce growth. Providers should offer plugins for popular platforms and improve support to boost online shopping.

In my recent online payment experiments, I worked with both Magento and OpenCart. While Magento is complex enough to make even a bishop go raving mad, it still came with some payment modules/plugins out of the box. Same for OpenCart. Conspicuously missing are the modules from top payment gateways in Nigeria.

From my own firsthand experience, handcrafting APIs for payment is a bore. It has significantly retarded the growth of ecommerce in Nigeria more than anything else.

If you want to accept payment online in Nigeria today, you are limited to payment gateways from:

  • InterSwitch and/or UPSL (ValuCard)
  • Banks and their proprietary systems
  • Other independent providers such as Pay4Me, etc.

Thereafter you are on your own. One, you don’t have any pre-cooked modules or plugins you can easily install on the most common payment applications such as OpenCart, Magento, PrestaShop, ZenCart, etc. and also their integration documentations are lame, non-existent or sometimes downright incorrect. Support is patchy and poor, and they want to charge you for every time you take a breath.

So how can life be easier? Payment gateway providers should make available modules or plugins that can be used for probably the 10 commonest online engines, including the venerable old WordPress and Joomla (yes, some people do use such). Also, they should have a vibrant support system such as an online forum – with sample codes, reviews, user interactions, blah blah blah.
This should create a network effect; as more shops go online, much more will like to go online. Ultimately anyone with a card will always have something to buy online.