Experts Challenge Nigerian Banks on Institutional Relevance
Banking and communications experts have called on Nigerian banks to change their priorities and prove their institutional relevance by contributing to the economic development of the Nigerian ecosystem.
The call was made during a topical discussion at the first edition of BRANDish Meeting of Minds held in Lagos with the theme: “What Nigerian Banks Should Do Differently”.
In their x-ray of the banking industry, the discussants submitted that the current modus operandi of Nigerian banks is not in sync with the society in which they operate, as they do not promote entrepreneurship which is needed for the development of the country.
Among the discussants where former APCON Chairman and founder of Prima Garnet Communications, Lolu Akinwunmi, Founder and CEO Proshare Nigeria Limited, Femi Awoyemi, President Consumer Advocacy Foundation of Nigeria, Sola Salako, Managing Director Quadrant Group, Bolaji Okusaga, Managing Director, TBWA Concept, Kelechi Nwosu, Managing Director 141 Worldwide, Bunmi Oke, and Director Corporate Communications Airtel, Emeka Opara.
In his paper at the meeting, Femi Awoyemi, pointed out that Nigerian banking system cannot give what it does not have because the system was designed to be exploitative rather than developmental. He stated that these banks operate within “policies that are not in tandem with the wishes and needs of Nigerians.” Hence banks target their best services at the “25% of Nigerians that have been empowered to be valuable to the banks.”
Suggesting ways forward for Nigerian banks, the discussants led by Awoyemi called for transformation of the Central Bank of Nigeria. Awoyemi, who is also a fellow of the Institute of Chartered Accountants of Nigeria, said CBN should be upgraded from being a “mere senior banker to the banks”. According to him, Nigeria needs a CBN that will “allow disruption in the sector with policies that will make banks development oriented.”
As a matter of urgency, it was suggested that Nigerian banks should be more customer centric by investing in consumer insight which would enable them know more about their customers, communicate better and be able to tailor their services to meet customers’ needs. The discussants noted that failure of the banks in their customer insight and market understanding duties is part of the reasons why Ponzi schemes such as MMM are thriving in Nigeria. These schemes they said have better understanding of customers and speak the language that resonates with them.
To help bridge the communication gap, Lolu Akinwumi advised that banks should start optimising their retail delivery and simplify their business and operational models. According to him, the lacuna between the banks and their customers is evident in bank advertisements which portray and celebrate bank executives rather than communicate specific service offerings and benefits to customers.
In addition, bank were advised to desist from the current trend in which they tend to reap from where they did not sow. Speaking on the regrettable trend, Sola Salako slammed Nigerian banks saying they rarely lend money to SMEs but start knocking on their office doors when they make it big. “Banks look for their money in government circles. So they care less about the other customers. They are concerned about the macro and don’t understand the micro economics.
But when you finally grow the business, they start knocking on your door and you wonder where they were when you were struggling to build the business. Let’s say the bitter truth, our banks are not responsible corporate citizens,” she said.
The discussants also tasked Nigerian banks to start preparing for the future of banking without a banking hall. They predicted that with the current global trend and evolving technology, the brick and mortar bank will not be “relevant to the upcoming generation, as brick will cease and banking will become a game of clicks.”
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