Nigeria Distrust Banks, Trust Mobile Phones

The real economy relies on the financial system. And the financial system depends on trust. Indeed, trust is imbedded in the language of finance.

Lamido Sanusi, former governor Central Bank of Nigeria (CBN) stirred the great reforms in the financial industry after discovering that some of the banks were clinically at the verge of collapse as a result of a combination of opaque financial system, the burden of non-performing loans and gross abuse of position by some of the bank chiefs.

In one fell swoop, managing directors of some of the affected banks were removed and thousands of innocent workers were also asked to go.

But something else was also lost – trust in the banking system. This deepened the cost of the crisis and is restraining the pace of the recovery.

According to a recent survey by Nigeria CommunicationsWeek, the banks and indeed financial institutions are still the least trusted sectors in Nigeria, more than five years after the reforms.

The result of the research is troubling given the fact that trust is the very foundation of banking.

And when benchmarked with telecommunications, the study found that Nigerians trust mobile phones more than banking institutions.

In the latest study, Nigeria CommunicationsWeek interviewed a cross-section of Nigerians and administered online questionnaires in twelves states across the geopolitical zones of Nigeria.

The low level of trust in banks is strange because trust is the very basis of banking.

The survey suggested that consumers’ personal experience with financial services providers is the most significant factor in determining the level of trust.

Ken Nwogbo, lead researcher said “The lack of trust in the financial services sector is in part the problem of the banks because they have done little to convince Nigerians that their targets are not profits”

A respondent summed it up “if it is not for the fear of robbers, I will put my money under my pillow. I don’t trust the banks to take care of my money”

Bonds of trust between banks and customers and regulators have been shaken by the mismanagement of banks and, on occasion, the malfeasance of their employees.

According to the study, more than 60 percent of the semi urban and rural population that were interviewed completely choose to have mobile phones as the primary channel for financial services rather than visit a bank.

Another 95 per cent choose not to go back home to pick their cheque book/ savings books but will go back to pick their phones if left at home.

But GT Bank has taken customer engagement and connection to a new height with an initiative known as “Call the MD of GTBank”.

Under the initiative customers who are dissatisfied with any GTBank service can call Mr Segun Agbaje, MD, directly from a designated phone in selected branches.

The main purpose of the ‘Call the MD of GTBank’ initiative is to enable the highest leadership level of the bank to get direct feedback of customer experience and address their immediate concerns on the spot, and thereby further improve the overall service culture within the bank.

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