Banks To Sack More Workers

The banking industry may yet again send
scores of its workers to the job market this
year following rising cost of running their
business, analysts have said.
The rising overhead cost is mostly a fallout
of the Central Bank of Nigeria (CBN)
directives to deposit money banks (DMBs)
to reduce charges on turnover (COT) from
N5 per N1,000 to N3 and the removal of
the N100 charged by banks for withdrawal
of money through automated teller
machines (ATMs).
Part of the fallout is that most banks now
keep one ATM operational at a time in a
bid to save cost. Most banks that have
three or more ATMs have one or more out
of operations as the weight of servicing
becomes heavier with the removal of N100
charges.
LEADERSHIP investigations revealed that
the banks are not happy about the
development, but have little choice over the
decisions of the regulatory body.
The banks are particularly sore that the
decision of not charging fees for usage of
their ATMs negates the very principle of
banking. According to them, put plainly,
banks are usually in the business of buying
and selling money.
The area of disagreement is that a
customer of bank A uses the ATM of bank A
to collect money from a bank B’s ATM for
free. The issue, according to them, is that
though the banking halls are actually being
decongested, money they got from
depositors at a cost is being collected by
customers of other banks at no cost at all.
The problem, analysts said, is two-pronged.
The first one, according to them, is that as
banks deploy more ATM machines and
bank customers gleefully use ATM more
because it is at no cost, and frees the
banking halls, as such, bank cashiers have
their jobs hanging in the balance, unless
they are deployed to other areas where
they will be more productive.
Banks’ staff’s fate remains hanging
delicately when the other problem is looked
at. This is because by the time banks spend
more money deploying ATMs, servicing
them, providing power 24 hours a week to
keep them running, the cost will be
unbearable, and as such the staff will just
have to pay the price.
Bismarck Rewane, chief executive of
Financial Derivatives Company (FDC)
Limited, said if you can now draw money
from any ATM of any bank, it means the
number of customers using the ATMs will
increase; therefore the number of
customers using cashiers would also
reduce.
According to him, if there are fewer
customers for cashiers to attend to, the
bank will have no choice than recoup the
funds spent on acquiring ATMs by letting
some cashiers and other staff go.
“There is going to be a cut-back in the
number of cashiers because if a cashier
attends to 2,000 customers in a day and
now because of the increased use of the
ATMs, the cahier is attending to 500
customers, the bank is definitely going to
restructure and either let go of the cashier
or transfer him to another department
where he would be more profitable,” said
Rewane.
Okechukwu Unegbu, former president of
the Chartered Institute of Bankers Nigeria
(CIBN), said unless the banks have agreed
at the Bankers Committee level, it is
unimaginable that a customer of bank A
collects money from bank B through the
ATM.
He said that, in other climes, when one
uses the credit card of another bank to
collect money from another bank, charges
are applied.
Unegbu nonetheless said banks could be
cutting down on overheads through hidden
charges. He wondered what the meaning of
a so-called management fee charged by
banks means.
He added that some of the banks were yet
to revert to N3 per every N1,000 as COT.
Instead, they still collect N5, he said.