As the economy reopens following the easing of restrictions to curb the spread of the Covid pandemic in Nigeria, the number of Automated Teller Machines (ATMs) in operation by the leading banks has become grossly inadequate, situation that has elicited complaints from customers in Lagos and Ogun states.
The customers decried the shortage of ATMs especially within the bank premises, which they lamented lead to long queues in some cases.
They complained that banks canvassed more customers on daily basis but failing to provide facilities to serve the increasing number of patrons.
They alleged banks may have deliberately suspended installing more and locating ATMs in key strategic places amid increasing customers and demand to transact business with cash.
InsideBusinessNG findings from the five leading banks in the country show that they have a total of 12,159 ATMs for over 126 million customers, according to their presentation to investors and analysts in 2020.
Although banks have improved on transaction channels, findings show that Nigerian banks with increasing branches and customers are struggling to provide enough physical means for access to cash.
ATM is the second means to access physical cash aside the banking hall and the Nigerian situation is becoming similar to that of the United Kingdom where C-19 pandemic, forced a plunge to 55,000 ATM units from 60,500 that existed prior the crisis. Almost 5,500 ATMs vanished by the end of December 2020.
In Nigeria, Access Bank Plc with over 40 million customers in 2020, and more than the population of 82 per cent (47) of African countries, has only 2, 963 ATMs, while FBN Holdings with over 30 million customers has 3,111 ATMs and 735 branches.
Further findings revealed that United Bank of Africa Plc (UBA) with over 21 million customers reported 2,675 ATMs in 2020 as against 2,550 reported in 2019.
In addition, Zenith Bank had 2,044 ATMs in 2020 from 2,009 in 2019, while Guaranty Trust Bank Plc (GTBank) in 2020 reported 1,366 ATMs from 1,326 reported in 2019.
Speaking with InsideBusinessNG, a customer of GTBank in Sango in Ogun state, Elizebeth Temitope, complained of the inadequacy of the cash dispensing machines which she described as a nightmare for customers. She urged the management of the bank to increase its ATM points in the branch, stressing that overcrowded customers between during the weekdays is alarming.c
Similarly, a customer of First Bank of Nigeria Limited in the same district, Moses Dada said the bank’s ATM often breakdown at critical period, leaving customers to queue behind few dispensing cash, and wasting their time.
However, a customer of Access Bank at Fagba in Iju-Ishaga area of Lagos state, Ajayi Peterson urged the bank to improve on its ATM services, and also to consider to open one more branch along the Agege/Ishaga road.
Interestingly, these banks have consistently supported the Central Bank of Nigeria (CBN) cashless policy with the introduction of digital channels such as Unstructured Supplementary Service Data (USSD), Points of Sales (PoS), Mobile App, among other innovation to ease banking.
The President,, Bank Customers Association of Nigeria (BCAN), Uju Ogubunka in a chat with ith InsideBusinessNG said shortages of ATM is not an the issue, but noted that poor network and crisis related to ATM transactions are major concerns.
According to him, “this is a developing country and the usage of ATMs in the banking sector has not been long. As we all know, ATMs installation involved huge volume of capital as they are procured in dollars
“We can only appeal to banks to increase the number and that banks should educate customers on the use of other channels to reduce dependence on ATMs.
“I think we shouldn’t be concern about the number of ATMs but services provided by the banks through its usage. Customers complain about ATMs not dispensing cash on the increase in the banking hall which should be.
“It is very critical that banks must provide effective ATMs channels for customers.”T
The UK experience where the number of ATMs has dropped from 60,500 units to 55,000 by December 2020 impacted transaction value, dropping to 4.39 billion pounds between January and April 2020. The number of transactions also halved, dropping to 91 million from 185 million.
Prior to the pandemic, the United Kingdom witnessed rapid adoption of digital payments as a more convenient way to manage money, especially among tech-savvy consumers. However, the COVID-19 speeded up the digitalisation of the entire payments industry, with millions of Britons choosing online payments over cash and ATMs amid the lockdown.
According to data presented by BuyShares.co.uk, the number of ATMs in the United Kingdom plunged by 5,500 in a year, falling to 55,000 in December 2020.
The statistics by BuyShares.co.uk show that social distancing rules and the COVID-19 lockdown led to a huge number of closed ATMs in the first quarter of 2020. In January, there were around 60,500 ATMs in the United Kingdom, which according to the UK’s Cash Machine Network (LINK) report dropped to 53,100 units three months after.
Statistics indicate a large number of ATMs remained shut down even after the authorities lifted off restrictions. In September 2020, Britons could use around 55,600 cash machines across the country. However, the November lockdowns caused ATM numbers to fall once again to 54,754 in December.
Besides a considerable drop in the number of ATMs, LINK transaction volume and value also plunged amid the coronavirus outbreak. In January 2020, Britons withdrew £8.18bn in a total of 185 million transactions. By the end of April, the transaction value dropped by 46 per cent to £4.39bn while the number of transactions halved to 91 million.
The ATM use increased through the early summer as the authorities lifted off many restrictions. Statistics show the number of transactions peaked at 141 million in August while the total transaction value hit £7.1bn that month.
The tightening of restrictions in October and November again caused a massive drop in ATM use, although not as much as the first lockdown. Statistics show Britons withdrew just over £6bn in 188 million transactions in November, a 43 per cent plunged in a year. Although these figures rose to £7bn and 129 million in December, it still represents a 34 per cent year-over-year drop. Overall, 2020 saw LINK volumes fall by 37 per cent and transaction values by 30% per cent year-over-year.
As the use of cash continues to drop amid the crisis, digital payments in the United Kingdom are set to reach a new record.
According to a Statista survey, the United Kingdom, as the leading digital payments market in Europe, is expected to hit $271.4bn value in 2021, almost a 25 per cent increase in a year. Statistics show cashless payments in the UK jumped by 40 per cent amid the COVID-19 outbreak. By 2025, their transaction value is forecast to jump by another 60 per cent to $439bn.
As the largest segment of the market, digital commerce is expected to reach $172.8bn transaction value in 2021 and continue rising to $219.2bn in 2025.
Mobile POS payments are forecast to witness a 123 per cent increase in this period, with their transaction value jumping from $98.5bn in 2021 to $219.9bn in 2025.
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