Emma Okonji and Amaka Eze write that 2012 was characterised by irregular telecoms services to subscribers, malfunctioning of automated teller machines (ATMs) and point of sale (PoS) terminals that drive cashless policy
The inventors of technology had a common goal in mind, which is to demystify human operations, using technology tools. The world all over has embraced technology to achieve the same purpose, and Nigeria is not left behind in this regard, which calls for commendation.
However, Nigeria's effort to align with world-class technologies appears to be failing the country as irregularities marred certain technological operations in the country in 2012, resulting in increased frustration among Nigerians who use certain basic technological tools in solving human challenges. Instead of getting relief from the use of such technology, it rather brought frustration and pains to Nigerians in the process of using them. Although there is a long list of such failing technologies, the writers of this piece focused on poor telecoms service delivery and how low broadband penetration affected the efficiencies of ATM machines and PoS terminal machines in driving the cashless policy initiative of the Central bank of Nigeria.
Irregular Telecoms Services
Nigerians were faced with challenges of poor telecoms services in 2012, which eventually crippled business activities and prevented subscribers from making successful calls across networks. The networks deteriorated to the extent that subscribers could not make successful calls and those who were able to generate partial calls after several trials, ended up not hearing the call recipient, yet they were debited each time attempted calls were made.
Apart from voice calls, the data communications system of virtually all network providers were also affected, as customers to data services like the internet, were having difficult time accessing the internet, after buying and loading data airtime into their modems.
Some subscribers, who spoke with THISDAY on the issue, said it had been very hectic for them making use of their mobile phones in 2012. A
Lagos businessman, Mr. James Chukwunonso, who is a subscriber to Globacom and MTN, said he was frustrated several times when networks appeared to have collapsed.
Narrating his ordeal, he said he lost several businesses due to the inability of the network to initiate certain business calls that were supposed to bring money to his business. "Apart from business calls, there were times I will want to reach out to my wife or make important calls, and the network will not be available. It is frustrating and at times I felt like throwing away my mobile phones, since they were not serving the purpose for which they were bought," Chukwunonso said.
He explained that the most annoying part of it was when the network operators charge for unsuccessful calls.
Subscribers to other networks who also bared their minds, said they were also frustrated at some points in time, especially when they needed to make important calls, and the network kept saying "your number in incorrect and you are out of the network coverage area please try again." Why must a network stop my calls abruptly and still charge me when I am not yet done with my calls, some of them queried.
Perceived Reasons for Network Failure
Many subscribers have been forced to conclude that it is either the network operators deliberately allowed the challenges to pile up beyond what they could handle or the network challenges are far beyond what the operators could handle.
Some stakeholders have blamed network operators for deploying substandard telecoms facilities, while others accused them of not expanding their network in a commensurate manner at which they sign on to new subscribers, blaming the situation on oversubscription on limited network capacities.
The Nigerian Communications Commission (NCC), the industry regulator has severally tried to address the issue of poor telecoms services across networks, but the challenge continued to reoccur year after year, with that of 2012 posing serious threat to telecoms operations in the country.
Worried by the situation, NCC had on November 8, 2012, placed a blanket ban on telecoms promos and lotteries. Director of Public Affairs at NCC, Mr. Tony Ojobo, told THISDAY that the essence of the ban was to put a stop to continued deterioration of the network quality, which he said had gone too bad as at the time the decision was taken.
According to him, the ban would definitely reduce the network challenges, and that operators were duty bound to constantly improve on their service quality.
Reactions to the Ban
Subscribers and consumer rights activists are beginning to react to the NCC's ban. Some of them are worried that the quality of service was yet to improve, seven weeks after the ban took effect. They have argued that instead of an indefinite ban, the NCC would have devised another method that would still lead to improvement on service quality, without affecting subscribers' choice of freedom and the operators' revenue generation in any way.
The Association of Licensed Telecoms Operators of Nigeria (ALTON), believes than rather than blame the network challenges on consumer promotions and lotteries, asked the NCC should look elsewhere. Chairman of ALTON, Mr. Gbenga Adebayo, blamed the network challenge on man-made and natural disasters. According to him, the recent flooding in some southern parts of the country and the attacks on telecoms facilities by gunmen in some northern parts of the country, were largely responsible for the challenge.
Low Broadband Penetration
Nigeria also witnessed low broadband penetration in 2012, a situation that compelled the Minister of Communications Technology, Mrs. Omobola Johnson to call for concerted efforts from the private sector in increasing broadband penetration from its current 6 per cent level to 20 per cent by 2013. The low broadband penetration also affected widespread rollout of cashless policy, as most ATMs and PoS do not have enough bandwidth to enhance its operations.
World Bank Study on Broadband
A world bank study revealed that about 10 per cent point increase in broadband penetration, in most developing countries across the globe, is capable of accelerates economic growth by 1.38 per cent, more than in high-income countries.
Nigeria's Position on Broadband
Nigeria is of the view that the current level of broadband penetration could prevent the country from attaining the Millennium Development Goals (MDGs) by 2015.
Having ubiquitous internet capacity and a national backbone that can provide critical ICT infrastructure is as important as having adequate water and transportation in today's globally connected and increasingly knowledge based world, the Minister of Communications Technology, Mrs. Omobola Johnson, said.
According to her, "broadband which has the potential to enable an entire new and significant industry must be strategically handled like the mobile telephony for greater impact. The need to interconnect the nation therefore became one of the highlights of the presidency, the telecommunications ministry, the Nigerian Communications Commission and other industry stakeholders.
She said: "Broadband and its universal access is becoming a significant indicator of development and competitiveness amongst nations. Empirical data tells us that every 10 per cent in access to broadband in every developing countries result in a commensurate 1.38 per cent increase in Gross Domestic Product (GDP). These compelling statistics should provide the impetus to meet broadband demand, and if the demand is not there, create that demand."
Executive Vice-Chairman, NCC, Dr. Eugene Juwah, also decried the low penetration of broadband in Africa and Nigeria in particular.
He said proper penetration of broadband in Nigeria would engender the growth of highly skilled workforce, engender global competence in industrial and service firms driven by ICT tools, as well as facilitate the growth of modern ICT driven education sector.
Cashless Policy and its Many Irregularities
Again, the cashless policy was supposed to reduce physical cash circulating in the economy as well as encourage electronic-based transactions to drive development in line with Nigeria's vision 20:2020, but the irregularities in the operations of PoS machines and ATM machines, caused it a great setback.
The benefits expected to be derived by the policy from the utilisation of e-payment systems include increased convenience to consumers, more service options, reduced risk of cash-related crimes; cheaper access to (out-of-branch) banking services and access to credit. For corporations, the benefits include faster access to capital, reduced revenue leakage and reduced cash handling costs, while increased tax collections, greater financial inclusion, increased economic development are some of the benefits expected to be gained by the government.
Consumers' Pain Going Cashless
Consumers and other stakeholders have maintained that the policy was yet to solve some of the teething challenges that have hindered the complete acceptance of the policy itself. Users of ATMs have continued to report issues with their various ATM bank services, saying they experienced slow or non-functional services, as well as shortage of cash especially in commercial centres during the weekends.
The PoS terminals users were also not left out as its users also complained of similar issues of unavailable or non-functional PoS terminals in most stores and super stores. Head, Group Marketing at Interswitch Limited, Mrs. Enyioma Anaba, told THISDAY that the major challenge with the cashless initiative was network and power, which had remained a challenge that would further hinder technical and advanced growth in the cashless initiative.
Challenges of Cashless Initiative
Calling for the issues to be given the proper attention it deserves in order for it to be resolved, Anaba said that if addressed properly, the new innovation will thrive.
"If you recall, when the ATMs were newly introduced, they were associated with a lot of challenges, but in the last couple of years, these challenges are gradually being addressed and there is no denying that ATMs have now become part of our everyday living." Anaba who accepted the actual challenges of cashless, said, "the concerns from various stakeholders on the poor reliability and efficiency of the PoS terminals might be valid."
According to her, "What this means is that if a particular network has low (or no) signal, the second SIM in the POS can easily pick up signal and allow a successful transaction. "Also, the CBN has licensed several Payment Terminal Service Providers (PTSP) operators, to focus on the PoS market and ensure that first and second level supports are given to business and merchant outlets that have PoS terminals," she added.
Commending CBN's Initiative on Cashless
General Manager, 3Line Card Management Limited, Mrs. Funke Ade-Ojo, said the CBN was on the right path but craved for more time to create the much-needed awareness for customers. Ade-Ojo who is very optimistic that the policy would further help to build up the e-payment culture obtained in the developed countries, stressed that the emphasis should be targeted at enforcing the relevant laws guiding the cashless economy.
"The Cashless Lagos initiative is one the most comprehensive regulatory-provoked schemes embarked upon by an emerging economy with a global quest to eliminate cash-dependence and all the inefficiencies that comes with. More than anything else, I am inclined to say that the initiative will bring out the best of innovations from all the stakeholders that are involved in the implementation," she added. The Executive Director, One Network, Mr. Sola Bickersteth, who applauded the project so far, however concurred with Anaba on issues with the PoS terminals.
He said: "I will give a pass mark to the cashless Lagos so far. In most banks, one will observe that bulk deposit rooms have actually being discontinued at most bank branches."
Call for Expansion of Cashless Policy
Lagos State House of Assembly recently passed a resolution calling for the extension of the cashless policy to other parts of the country by January1, 2013, in order to achieve its purpose of reducing physical cash in the economy.
The House had called for the cashless policy to be deployed across the entire nation by and all teething problems observed in the operation of the policy should be taken care of immediately. The House also called on operators in the telecommunications to provide adequate and functional infrastructure to support the cashless policy on their networks.
The House said it took the resolutions based on its observation that the cashless policy was aimed at providing more efficient banking services and improving the effectiveness of the monetary policy in managing inflation and economic growth.