Turning ‘System Anomalies’ Into Gold -By Afolabi A. Dania

Afolabi A. Dania

Imagine a business model where a seller can retrospectively increase the price of a good or service and claim a balance payment several days AFTER the buyer has completed the purchase and ‘consumed’ the good. That has to be a very appealing, but unfair model right? That is exactly what Guaranty ‘Trust’ Bank (GTB) did to their ‘Non-Resident-Nigerian’ (NRN) costumers over the days of the 26th and 27th of February 2016. This opinion piece explores the current exchange rate imbroglio, the actions of GTB and the need for a strong, independent financial ombudsman. It is also intended to stimulate a conversation amongst Nigerians as attitudes to service quality and delivery.

Background
Almost all Nigerians would be familiar with the currency situation amidst dwindling oil prices and accusations of mismanagement by the past administration. With the Central Bank of Nigeria (CBN) insisting on pegging the Naira at what most analyst feel is an unrealistic value, the currency has been subjected to huge pressures and wide speculations in the parallel market resulting in a sharp dip in value. Access to Forex in Nigeria at the official rate has become an almost impossible task with the resultant effect being that currency speculation has become very lucrative for those with access to forex. Even the banks are not left out of this jamboree as they charge ‘black market’ rates for card services (POS or ATM) abroad. The irony is that if a domiciliary account holder were to trade their forex to the bank, it would be done at the official rate; a difference of about N100 on the dollar or N150 on the Pound. What is worse is that NRNs have no way of knowing the exchange rate for the day until they have carried out a transaction or hear from someone who has recently done one.

The incidence
GTB happen to be my favourite Nigerian brand up to this time of writing this piece. However, there are certain principles that I stand for such as ‘Trust’ which incidentally is part of this great Nigerian Banks’ name. This principle was seemingly violated with the event that led to writing this piece which I would narrate as follows;

The week of the 22nd February witnessed the Naira gaining ground against other currencies. Therefore, it was with joy that GTB’s NRNs observed on Friday, 26th of February that the POS/ATM rate for the day was N278 to the Pound and N199 to the Dollar. Given a mix of factors; the similarity of this value to the CBN rate, price movement during the week (which some credited to Ifeanyi Ubah) and the anti-corruption posture of the current administration; NRNs did not think much of the matter and thought succour had finally come to their side (we never understood why obtaining forex through one’s card yielded black market rates). Many made transactions and withdrawals buoyed by this favourable rate. But alas, by Saturday evening, this rate was reversed and few started to fear what would come next. By Monday, GTB sent out emails referring to a ‘system anomaly’. An extract from the mail reads:

‘Please note that as a result of the SYSTEM ANOMALY, the WRONG RATE was applied in determining the settlement amount WE ADVISED for your international transactions between the period stated above. This anomaly has now been RECTIFIED, and as such the SYSTEM will automatically correct all transactions that occurred between this period and apply the correct or APPLICABLE EXCHANGE RATE at the TIME OF INITIATION’. (The emphases are mine). This brings up a few questions for GTB and her customers.

What system?
GTB should be cautious to know that a lot of its customers are smart and educated enough to understand a bit about banking operations. Thus, the customers deserve a more robust explanation of what system they refer to. Is it the staff charged with some responsibility, a computer software or hardware breakdown/ malfunction? At the back of this probe is trying to understand who bears the liability for this ‘anomaly’. Systems do not create themselves. If it was a staff error, certainly those responsible should face disciplinary action. If it was hard or software errors, I am pretty certain that GTB would currently be in high-level talks with the vendors of these equipment/products to discuss loses and recompense. In this, I see no part the customer played in this ‘anomaly’.

Wrong rate
This begs the question; what is the right rate? Who sets the rate? Is it transparent? Does the bank have a channel electronically or otherwise to inform customers on the rate for the day? I recall placing a call to GTB’s 24-hour customer service (excellent service I must add) and inquiring about how to find out the going rates for the day and I was directed to MasterCard’s website with no joy. My argument here is that customers would have had no inkling of a ‘system anomaly’ at ‘the time of initiation’ since they did not have anywhere to authoritatively verify rates for the day from GTB. Having profited from subjecting customers to speculative transactions over the years, now that it has gone wrong, the bank wants to make these same customers liable.

Who bears the responsibility?
By its very own wording, GTB admits that it was responsible for the amount ‘advised’ for the transactions on those days. It also admits that it was its systems that failed. So why did the bank go ahead to adjust the rates and bill accordingly immediately throwing its valued customers accounts into chaos on Monday? Are they aware that many customers would no longer be interested if they had known about the ‘correct applicable rates’? Did they offer such customers to return this forex and reverse the transactions totally? Are there any legal implications for this action or is the bank only acting because Nigerians would only ‘grumble but not act’ and those like me who would like to act would get buried in tonnes of legislative fine print and technicalities?

Way forward
In this crucial time when we are urged to consume Nigerian goods and services, it hurts me to be writing strongly against this brand. However, in this case, the bank has taken an opportunistic and unfair stance because they have access to customer’s funds. The aggrievement that we NRNs feel must be addressed. Already, there is an on-going online petition against GTB to the CBN which is gathering signatures (see https://goo.gl/naolVe). I do not know the legal implications of the actions of the GTB or if Nigeria has sophisticated consumer protection laws to protect customers. But we feel this is grossly unfair and in seeking redress of their ‘system anomaly’ the bank has elected to throw its customers under the bus. Many Nigerians would agree that they face numerous inhumane treatments especially from banks but unfortunately have no recourse to justice or fairness. The recent ‘no banking day’ is a reflection of this growing discontent.

This opinion piece calls for GTB to revisit their actions of Monday the 29th of February. It also calls for the intervention of the CBN’s compliance unit and the strengthening of Nigeria’s Ombudsman (the Public Complaints Commission) to empower the ordinary man against the growing might of domestic corporations. GTB cannot be the Judge, the jury and the executioner at the same time. It is hard to imagine this happening in any advanced country without a public apology, heads rolling, and a fair representation of the interest of the customers. If GTB have a genuine case, let it be open and transparent with an independent verification by an external investigator. Above all, whatever actions should be considerate of its loyal customers.

Afolabi writes from Reading, UK and can be reached on afolabidania@yahoo.com