AGENCY Banking – using Point of Sale, PoS, terminals introduced by the Central Bank of Nigeria, CBN, to facilitate the cashless economy policy – has become a source of violent death for our youths. Agency Bankers receive and give out cash to customers using the PoS. They are licensed by commercial banks to penetrate remote areas and capture the unbanked.
The process is also aimed at easing off crowds in banking halls and Automated Teller Machines, ATMs, as well as saving banks from establishing branches in unprofitable remote and thinly populated areas.
But apart from jeopardizing the CBN’s cashless policy, cash-dispensing Agency Bankers who use PoS in small kiosks in open and insecure places have also become prime targets of armed robbers. According to media reports, at least eight bank agents, especially young girls, were killed by armed robbers and their cash carted away in Aba, Abia State between mid-December 2020 and mid-February 2021.
Although statistics from other areas are unavailable, the killing of PoS operators by armed robbers is rife. It has become part of the rising culture in our society of taking innocent lives for mere stipends without blinking.
As a solution to this bloody menace, people should be encouraged to use PoS terminals for retail payments instead of using them as cash dispensaries, which is what attracts the criminals.
To this end, the CBN needs to roll out more PoS terminals for providers of services and retail outlets to reduce peoples’ need for cash payments. PoS serves the cashless policy initiative better when it is used to make retail payments than for withdrawal of cash.
As of November 2017, Nigeria had only 150,000 PoS terminals in circulation. This was grossly inadequate for a population of nearly 200 million people compared to a country like Brazil which has almost the same population but recorded 1.5 million PoS terminals.
Another solution is to strengthen PoS security in Nigeria because it appears many Nigerians are reluctant to use the terminals for payment due to fear of insecurity in transactions. For instance, as of 2017, Angola, whose GDP is much smaller than Nigeria’s, recorded one million transactions on PoS terminals per day, while Nigeria did not even record up to 500,000 transactions per day, due to a deficit in PoS terminals.
The government needs to wake up and arrest the escalating spate of insecurity in the country. The unemployment of our youths, which helps in fuelling armed robbery and other criminal activities, needs to be curbed.
The strategy of deploying agency banking to promote economic activities in the grassroots and rural areas is laudable. But it must be made more secure. We must borrow from the experiences of other more successful countries.