The last three weeks have been difficult for Nigerians to make payments with bank apps. The country’s cash scarcity has caused traditional banks, such as Zenith Bank, UBA, Access Bank, and First Bank, to experience higher demands on their digital payment services, leading to customer delays in online transactions, unsuccessful transactions with no reversal, and frustrations. These issues validate the age-old sentiment that Nigerian banks are not great at retail banking.
This unreliability is opening up opportunities for digital-first players such as OPay, Kuda Bank, and Pocket, which are offering more reliable service options than traditional banks in some cases due to their focus on providing excellent customer service rather than focusing solely on profit margins or market share gains like many of the larger incumbent institutions do.
The use of these digital-first players has received praise from many Nigerians. “I have had my fair share of these challenges,” Mr. Akinwale told RateCaptain, “having gone to lunch and then a grocery, where I ultimately needed a buddy to help me transfer from Opay Bank.” “You can tell something has changed in the past few weeks because OPay is slower than usual, yet my transactions usually go through,” he told RateCaptain. Transactions, he claims, take roughly 20 seconds longer than usual.
OPay’s transaction speed has dramatically slowed down over the past several days, according to Lexa, who claims she started using it when she flew to Osun State for work. I don’t get an immediate response indicating a successful transaction, she said to RateCaptain. She will choose this over her regular bank despite obtaining a three-step processing answer that states that the money has been transmitted and that the recipient bank will confirm or has confirmed. I still have regular bank transactions that are pending from two weeks ago. I had money taken out of my account, but it hasn’t yet arrived at the receiver.
Kate, who has personal and business accounts, told RateCaptain that she has been using Pocket over the last few weeks. “My bank was typically reliable before this, but when the Naira crisis started, Piggyvest did a campaign about withdrawing your savings through Pocket and transacting from there to get points, so I reinstalled. So far, the experience has been good; the only blight is that I don’t get receipts, so I have to use my account statement for corporate refunds.
Jolomi told RateCaptain that he has used Kuda bank and the Pocket App for the past two weeks. “My experience with Kuda Bank was 95% good, but they needed to do maintenance one time, and I didn’t see the notification on time, so I was stranded.” Pocket has been 85% good. When I transfer money, it gets to the receiver within 2 minutes. “But the app struggles when the internet is slow.”
Customers are increasingly looking towards alternative providers of financial services because they offer better reliability during times of financial stress compared with traditional banking systems, which appear unable or unwilling to provide adequate support during these times when it matters most. As such, it appears clear that if Nigerian Banks wish to remain competitive they must invest heavily into improving their online platforms to ensure customers receive timely payments without hassle even under periods of high-demand conditions.