New naira: Banks, banking, and the unbanked

Francis Ikuerowo Business, Featured 09/02/2023

The advent of banking has changed the dynamics of our lives. It has enabled us to carry out financial transactions like saving, sending and receiving money, purchasing goods or making payments online with our debit cards, and getting loans for personal needs and small/scale businesses. These are the core services of banks which are collectively called banking.

However, the recent naira scarcity seems to show that most Nigerians are largely unbanked or are not into banking. At best, they have some money in banks and believe that they are banking while in the truest sense they are far from banking.

Banking has become a part and parcel of our lives. Yet, it requires astuteness, shrewdness, and adaptation to do the business of banking. These days, it is not enough to have bank accounts; it is equally important to understand how this money can be put to work in a way that provides comfort for the owner and ease him of the financial stress. This financial comfort is the essence of banking, the ideal banking.

Since the new naira crisis has caused a lot of people to queue in the sun, waiting for their turns to withdraw money from the ATMs, I often wonder whether this is what banking entails. Ideally, I feel getting my money should not subject me to this level of trauma. I have not withdrawn or used the POS for the past two weeks (and I’m not proud of this); but I have been able to get everything I want via exploring the options that banking provides.

Banking in the new-naira era

Banking in this new-naira era requires Nigerians to believe that they can get everything they want with little or no stress. It is in believing in the possibility that they can buy or get anything they want even though it appears daunting. Banking is simply banking on other people’s good graces.

To bank effectively, one must begin to ask some fundamental questions. Why do I need this money? How can I get this stuff with less stress? Is there any substitute for the item on my list? Is there a way I can make a transfer for my groceries? Is there a way I can avoid POS and ATMs?

For example, you may need cash to travel, but have you ever wondered if the driver accepts a transfer? If he refuses, is there any other driver who will be willing to accept a bank transfer? You may need to buy fruits, but have you ever wondered if there are other fruit sellers who might be willing to accept bank transfer? Instead of buying fruit, can I buy a bottle of fruit juice? Asking some fundamental questions is one of the ways to evade financial stress that your money might put you through.

In a way, having at least two digital banks that can save you from the shege of traditional banks seems to be a form of better banking. If one fails, the other comes in handy. This can also go alongside having multiple debit cards. This provides you with multiple options, and options can give you not only some level of financial freedom but also ease you of financial stress.

It is also useful to maintain a good working relationship with local sellers so that you can bank on them. They will always sell for you on credit till you can pay them back. Some may even accept bank transfers.

The effect of banking on the unbanked

Banking is forceful, destructive, and in some way it shatters the existing tradition. It also requires a bit of selfishness, too. The result of effective and creative banking leaves the unbanked at a great disadvantage. For instance, small-business owners who refuse to accept transfers may begin to lose some customers. In the same vein, individuals who harness the power of banking will, in the truest sense of it, have little or no financial stress.

Promoting inclusive banking

One of the greatest barriers to inclusive banking in Nigeria appears to be our inability to embrace change. Closely linked to this is the desire to exploit others for pecuniary gains.

For example, last week, I wanted to buy a drink which was supposed to be #250 from a woman that sells on my street. She said I’d pay an extra #100 because I was going to pay with my debit card on her POS. I quietly walked away, mumbling to myself, “I still have two bags of pure water at home”.

As our society evolves, it behooves local retailers to start accepting bank transfers and the banked individuals to show them how banking works. These retailers can also make transfers when they are buying in bulk. It is going to be a win-win for both buyers and sellers but more for the former because they are going to make more sales.

Lastly, banking innovation should tilt towards catering for the interests of the unbanked individuals: taxi drivers, local restaurant owners, fruit sellers, people living in rural areas, etc. All of these will go a long way towards engendering inclusive banking. And everybody will become financially happy after.

Going forward, is destruction of banks even necessary?

EFCC arrests bank official over alleged hoarding of new naira notes

While it is true that some banks are hoarding the new naira notes, the destruction of banks’ properties by some Nigerians is a manifestation of infantile madness and gutter behaviour. Over the years, there are three words that characterized the anger of many Nigerians: misdirected, misguided, and destructive. This anger has yielded us nothing and in the worst way possible, it has brought us way backward and portrayed us as citizens unable to articulate our anger into meaningful actions.