Electronic Banking in Nigeria is a rising trend. However, this system has some hitches that need to be removed. Electronic banking is now a global phenomenon and is now utilized by countries round the world and Nigeria is not an exception. Electronic banking has many advantages and should be highly encouraged.
These advantages are many despite the fact that Nigeria is yet to fully utilize its potentials in electronic banking.
1) Location independent: Electronic banking has reduced dependence on certain locations before performing certain banking transactions. People now stay comfortably in their homes and perform a banking transaction using electronic devices without increasing road traffic. The rise of electronic devices has also made electronic banking in Nigeria, a rising trend. This method of banking have also reduced excessive traffic in certain cities in Nigeria by reducing the number of people who wake up in the morning to start rushing to the bank just to perform transactions that can be performed with their mobile devices. This is also a good way of reducing traffic congestion.
2) Time saving: Electronic banking saves time. It saves both the time of the customer and the time of the banking officials. Manual banking actually has some crude attributes and one of them is that a lot of time is spent performing a transaction that can be performed within a short time. The use of electronic banking in Nigeria has now become a time-saving factor enabling multiple tasks to be done within a short period of time.
3) Money saving: Yes electronic banking saves money. The money you spend in transporting yourself to the bank to perform a transaction can be saved and used for other purposes. We all know that fuel prices in Nigeria are skyrocketing and this has led to high cost of transportation. Nigerians can now minimize the rate at which they transport themselves to the bank to perform their transactions. This electronic banking system is a money-saving mechanism in Nigeria.
4) Track spending: Electronic banking has now made it possible to track spending by customers. Customers who engage in little or no budgeting now using available banking mechanisms to track their spending rate. During online bill payment or purchase made with debit card, certain bank applications shows the spending chart by noting the expense as utility or otherwise. These applications enable you to check your expenses made from your account. It will be hard for customers to track their spending without making use of electronic banking system as the manual banking system does not have adequate measures for tracking spending.
5) Importation: Electronic banking has made importation better in Nigeria unlike manual banking. Nigerians can now stay in Nigeria and pay for products from anywhere in the world and get them imported using electronic banking. This banking method facilitates the importation of goods in Nigeria. This method has also enabled Nigerians to participate with others in global marketing.
6) Industrial benefits: This method has enabled banks to minimize the cost of labor and the cost of supply by making the customers to handle certain transactions by themselves instead of the banking officials handling it. This is an industrial benefit for banks in Nigeria.
7) Portability: The use of electronic banking in Nigeria has increased portability for customers making the banks to be more mobile for customers. The use of alerts and other banking mechanisms have made transactions mobile-friendly. Flexibility is now promoted in our banking systems.
Even though electronic banking in Nigeria comes with so many advantages, it still comes with some disadvantages which are listed below:
1) Electronic fraud: Electronic fraud is now very rampant in Nigeria as there are now many fraudsters who take advantage of the electronic banking system to defraud fellow Nigerians. There have been many stories of people going to another person’s ATM to withdraw. This is one of the disadvantages of electronic banking. People also perform fake transactions with others using the Nigerian electronic banking system.
2) High insecurity for banks: Hackers in Nigeria now hack banks in Nigeria using certain methods. This has enabled them to hack into database of some banks causing loss of funds. Manual banking has less level of insecurity as the person has to be manually verified by the bank before performing the transactions. There have been stories of banks losing funds to hackers hacking into their database. This is one disadvantage of the electronic banking system since it has now made it easier for fraudsters.
1) Use of tight security measures: The security of the Nigerian electronic banking system is yet to match its quantity of fraudsters. The electronic banking system in Nigeria is still very loose in terms of security. This has encouraged electronic fraud in Nigeria as the security measures are not yet tight enough to reduce the menace of electronic fraud in Nigeria.
2) Use of anti-hack systems: Banks in Nigeria should make use of better systems that discourage hacking systems. These systems will promote electronic banking system in Nigeria. Fraud alert systems should be encouraged in Nigeria.
3) Awareness creation: The Nigerian public needs to open their eyes to the activities of fraudsters. Banks should notify their customers to take necessary precautions. The government should also create more awareness on the techniques used by fraudsters. This can be done by making use of the radio and television. This will keep Nigerians at an alert.
4) Use Of credible staff by banks: Banks should always ensure that they are making use of credible staff that will not leak or tamper with bank security. Banks whose staff is not credible end up losing funds and this sometimes affect the bank customers. This is common in Nigeria. There have been cases of customers losing funds to such staff. The banks in Nigeria should take extreme measures to ensure that they are making use of credible staff. They should ensure that certain transactions that involve bank security are handled by the appropriate staff in order to ensure their security and this will actually promote electronic banking in Nigeria.