If you’re a keen observer of the Nigerian financial services industry, you will notice that bank and financial technologies seem to be the foremost innovative fronts in the country today; at least from the public’s point of view, mostly because we all have one financial transaction or another to perform daily and they have a large spend arsenal for advertising their achievements and industry innovations.
Banks in Africa’s largest economy have come to the realization that there has to be solutions that will solve real life problems such as improving payment systems, reducing ATMs queues, cyber security and improving financial inclusion.
Although GTBank has maintained a major dominance within the Nigerian digital space over the years, which was once again recently reaffirmed with the launch of the GTworld app, this hold however seems to be dissipating as other players are starting to pay a lot of attention to online, social and web/digital assets.
Wema Bank recently introduced Alat and even though the app has its operational glitches, the enthusiasm with which it was received by the public proves this point.
Access bank is partnering with several fintechs to dominate the payments space and diamond bank has been consistent in its drive to migrate customers to its digital platforms.
More interestingly however is the fact that Zenith bank, which has always been known as a corporate focused and elitist financial institution is fast establishing a strong foothold within the social media and online space.
The bank seems to be bringing the aggressiveness for which it is known to this space as it starts taking advantage of the opportunities digital avails companies to interact with existing customers and prospects. The Bank has successfully built a very large social following in a very short time, which watchers suspect is part of an attempt to change public perception about its elitist toga and encourage the public that they have a more appealing side and anyone can walk into a Zenith Bank branch and open an account with only N1,000.
Take Facebook for instance, under a year, the Bank has grown its following from less than 100,000 to 2.4 million followers, surpassing every other top tier bank including banks that have had a well-defined digital strategy for years, with the exception of GTBank which has had a 5–6 year headstart in social media marketing.
On Twitter, Zenith now boasts over 500,000 followers, which is also the second highest in the Nigerian banking industry and it is also active on Instagram with a following that many a Nigerian social media influencer would envy.
Not just the numbers are impressive though as there has been a massive improvement in the quality of Zenith’s social/online messaging, which now connects more and is more relevant to the retail market.
Its response to interactions on social media is also quicker and the Bank’s new website is very pleasant, youth focused and easier to navigate. A look at the quality of the bank’s email messaging and email transaction notification design also seem to support the premise that its strategy for the future is to target and appeal more to the Nigerian youth market.
These activities by the big banks posit new opportunities for the Nigerian public to choose a banking partner, especially where Zenith and GTBank are concerned.
Complaints have been rife over the last two years about GTBank’s dwindling service standards and crowds at its banking halls which, with Zenith’s larger branch network and seemingly greater focus on service quality, could swing the pendulum for the bragging rights to the biggest retail banking player and socially responsive bank in Nigeria within the next two to three years, especially if Zenith successfully starts to attract younger customers through loyalty schemes and social engagement programmes.
With increasing expectations from customers for banks to give them more value, it is almost certain that those that come out on top in the new future may have to introduce a new form of product offering that is more suited to the individualistic nature of today’s public.
Zenith Bank’s innovative products and aggressive retail banking paid off as the lender’s third quarter earnings beat analysts’ expectations.
For the first three months through March Interest income increased by 40.29 percent to N118.09 billion from N84.17 billion as at March 2016. Non-interest income increased by 94 percent to N29.64 billion in the period under review from N15.25 billion as at March 2016; driven by account maintenance fees and trading income.
Zenith Bank’s profit before tax was up by 37.60 percent to N44.20 billion in March 2017 compared to N32.12 billion the previous year.
According to Dr. Andrew S. Nevin Ph.D., Advisory Partner and Chief Economist, PwC Nigeria in his comment on the Nigeria FinTech Survey 2017 said, ”FinTechs are empowering customers by providing services that are delivered via technology applications on customer’s mobile devices. This allows consumers conveniently initiate and complete transactions, connect to third party entities and access information without restrictions.
Digital finance can help power inclusive growth in Nigeria as close to a half of its population are excluded from the financial system.
Digital Financial Services (DFS) could raise $36 billion of new deposits and save financial institutions in Nigeria about $8 billion a year in costs according to a September 2016 report by research institute, Mckinsey Global Institute (MGI).
According to the report, DFS can add an additional 12.40 percent to the Nigeria’s GDP (i.e $88 billion) by 2025.
Nigerian banks will have to be wary of increased cyber crimes and it attendant impact on their revenue streams.
Nigerian Deposit Money Banks, DMBs, lost N2.19 billion to fraudsters through electronic channels in 2016 fiscal period, according to the Central Bank of Nigeria (CBN).
According to the report, 19,531 fraud cases were reported by banks in 2016 as against 10,743 recorded in 2015.
A breakdown of the actual amount lost showed that across the counter transactions with a total value of N511.07milllion accounted for the highest losses.
BALA AUGIE
