Internet Banking: How Far Has It Gone?
By Amarachukwu Ona
Before the advent of internet banking, Nigerian banking public had ugly experiences as they waited for long periods of time at the banking halls trying to do one or two transactions.
This explains the growing apathy of Nigerian banks going into internet banking
However, since the last five year especially with the emerging issues in today's banking, Nigerian banks have been strive to achieve greater milestones in internet banking practice with a view to narrowing the gap between them and those operating in the advanced countries of the world.
A primary objective of this system is to eliminate the delays associated with queuing and wasting time at the different banking halls. This really carries with it challenges of infrastructural development and accessibility of internet services, among others, in every nook and cranny of the banking environment.
This also makes it expedient that Nigerian banks should move quickly away from a cash-based economy to an electronic payment system, which is obviously the way the world is going.
Globally, all Central Banks have a heightened concern and interest in the development of internet banking services. This is expected to enhance the stability of the financial system, reduce transaction costs, especially time, support efficient use of financial services, minimise attendant risks and improve financial market liquidity, among others.
Prior to internet banking and electronic smartcards, financial institutions around the world were already conducting telegraphic transactions by way of wire transfers but this was not done on real time.
They say, "Internet changes everything". Indeed it has offered an almost limitless possibility for open systems payment and settlement solutions for literally every level of business.
Towards this end, Nigerian banks have sought to meet customers' expectations interms of convenience. This was seen in the growing desire by of almost all of them to go into internet banking and on-line banking, among others.
A school of thought believes that what Nigerian banks are doing is not really internet banking but on-line banking.
They argue that most banking public do not have internet access in their various homes, except in their offices.
Accordingly, internet banking service is one of the major products of electronic banking, which its service enables customers view their account summary, obtain account information, request for account statement, apply for letters of credit, view details of uncollected funds, confirm cheques, apply for bank drafts, order cheques and stop payments.
Customers are also able to perform internet transfer, wire transfer and automatic transfer, while it also allows incoming and outgoing messages for the customers.
At least more than 30 Nigerian banks claimed to have internet banking service in their product portfolio. Few are really doing well in that area.
THISDAY investigation revealed that what most banks do is on-line banking and not internet banking. What banks mostly have is on-line application, where customers are able to perform transactions.
This cannot be said to be internet banking, but it can illuminate on-line banking behaviour and provides opportunities to integrate the internet in the direct marketing strategy of a bank.
What the protagonists of internet banking are saying is that a new window, which accords a lot of convenience, confidence and flexibility to the banking public has been on even with the challenges of lack of access to internet, which constrains customers from taking effective advantage.
This, may have also affects the growth of several internet banking services floated by some banks.
The Managing Director/Chief Executive Officers, First Atlantic On-line Limited, Mr. Deji Oguntonade who spoke to THISDAY explained that internet banking despite all odds and challenges it has been facing since its launch in November 2000 is gaining popularity from year to year.
He added that, Nigerians have better access to internet now that five years ago.
"We have better internet access than before, many internet providers are springing up and the price is dropping. All these have made it possible for more people to gain more access to internet and this has been encouraging for us that have internet banking product", Oguntonade said.
He also said that with some GSM mobile handsets offering internet services, customers who do not have access to internet can use their handsets to access internet.
"This is a very remarkable development. We can also see more cyber cafes flourishing everywhere, Broadband is also here. All these points to the fact that internet is gaining grounds in this nation and as such internet banking is also gaining grounds in the same direction", he said.
Speaking on the challenge of lack of accessibility of internet, he said the banks have, to a large extent, tackled it by making provision of stand-by power generation and back-up internet provider in case one goes down.
He noted that the major challenge at hand is to propagate the gospel of internet banking in order to get as many customers as possible.
"We actually have more customers, but we are still not anywhere when compared with the population of the banking public", he added.
The Head, Electronic Banking, Equity Bank of Nigeria Limited, Mrs. Juliet Odesanya, shared the same view with Oguntonade.
She also called on government to do everything possible to ensure that internet service is provided to every nook and cranny of this nation.
This, she said, will boost the effectiveness and efficiency of internet banking in Nigeria.
Though internet banking has experienced some major hitches in Nigeria, it would be disastrous to abandon it. The major developments in internet banking in Nigeria indicate that if the coordination, cooperation and competition are channelled in the right direction, banks can transform the nation into a key internet banking service provider.
In a fast growing global environment, there is always enormous challenge for banks to continue to innovate more sophisticated products. There is even greater challenge to improve service delivery, for increased customer satisfaction.
This would place Nigeria at the leading-edge and greatly increase the use of banking halls and non-cash payment instruments.
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