Legal and Judicial Affairs

CBN resets structures, processes for mobile banking

the Central Bank of Nigeria, CBN, is set to further improve the system of the banks and this is against the backdrop of several complaints emanating from the banking public over services delivery and security in Nigeria’s nascent mobile banking environment.

Governor, Central Bank of Nigeria (CBN), Mr Godwin Emefiele, The apex bank has also indicated that its consumer protection department is inundated with petitions and complaints mainly from the mobile banking activities.

The complaints shows that most of them relate to loss of money due to either malfunctioned platforms or outright fraud.

At the Vanguard Economic Forum recently, CBN’s Director of Banking and Payment System Department, indicated that the apex bank is aware of the challenges in the mobile money services and is set to address the problems as they have already emerged while putting structures and procedures in place to forestall other forms of services failures in the banks that undermine customers’ satisfaction and security of their money.

He stated: ”The CBN is currently reviewing the structure and processes of mobile money to make us becoming more responsive to the emerging new financial services landscape.

”We are positioning our people to respond effectively to the emerging risk while also observing the payment system security and risk management to effectively ensure that the banking system is alert to the challenge of the more inclusive financial services sector.”

Fatokun also noted that Nigerian banks are aggressive in the application of financial technology, Fintech, in delivery of services, and are globally competitive in this area.

According to him, ”Not only has Nigerian banks embraced technology; we are also deploying what I will call a high level of anti-fraud mechanism by the banks.

Ask our friends all over the world, in how many jurisdictions do you actually receive alerts on volume of transactions? Very few; then how many jurisdictions have your transaction declined because it is not in pattern with your behavior? Not many.

”My position is that when it comes to embracing ICT (Information and Communication Technology) by Nigerian banks, we are in the fore front and not at the back.”

But he acknowledged that in addition to the weak lines in banks that have prompted the huge number of complaints, illiteracy also accounts for the problems in the mobile money services.

This, he said, may have resulted in a high rate of exclusion in the financial sector at a time the apex bank is already pressed for time in delivering the financial inclusion target of 80 percent by 2020.

Earlier in a forum organized by Bank Customers Association of Nigeria, BCAN, in Lagos, the Acting Director Consumer Protection Department of the CBN, Mr. T.Y Ahmed, representing Governor of the CBN, Godwin Emefiele, said following the last global financial crisis, the relationship between consumers and their service providers is being continuously scrutinized as one of the contributory factors to the crisis was inadequate consumer knowledge and protection.

He explained: ”The crisis demonstrated that the cause of financial system stability is best served when consumers are knowledgeable about their obligations and rights.

”In this regard, many jurisdictions have reconfigured their regulatory architecture to reflect the compelling need for improving customer awareness.

”In Nigeria, the Central Bank of Nigeria created a Consumer Protection Department in 2012, to among other functions, educate customers of their rights and responsibilities”.

But at the backdrop of the apex bank’s containment measures, Ahmed has also seen some major challenges in achieving the desired objectives. These challenges may have reflected in the nature of complaints streaming into the consumer protection department of the apex bank, which he indicated, are mainly arising from digital banking services.

He stated: ”The Nigerian banking industry has over the years grown in terms of capitalization, customer base and diverse products and services including digital financial services.

”The level of consumer awareness and sophistication in the industry, however, leaves a lot to be desired as demonstrated by findings of many studies as well as the nature of complaints received at the CBN from customers of banks”.

For the CBN, according to him, ”the vision is consumers that feel confident and secure to participate in the financial system; financial institutions that demonstrate responsible business conduct in their dealings with customers; and regulatory authorities that proactively engage customers, operators and other stakeholders for the good of the financial system”.

Source: Voice of Nigeria