The Nigerian banking sector seems extremely competitive. But that competition may not be deep if you see how banking is done in America. In other words, despite the competition for commercial banks in our land to get the next deposit, there is indeed a great opportunity for a neobank to deliver a new basis of competition on service delivery. This service delivery is not just responding to emails or complaints, but going beyond customer needs, expectations to perceptions.
Why am I writing this? Last week, I received an email where my US company bank was blasting introductions to companies, telling them that it has a great customer they need to assist on global shipping. I did not make that request but I did tell them when we spoke on Tuesday that I hate delays on our goods to Peru, Canada, Romania and other places where we ship things.
The delay was not their fault; it was custom related but the bank is doing all it can to fix that problem for us. In all the emails, it began thus: “Business sells farming electronic equipment to customers outside of the USA.”
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Now, think of it: can your bank help you fix the Apapa dreadlock? If not, can a neobank go ahead, identify some critical customer issues, and use its capabilities to help customers solve those issues? We’re an engineering company. We like designs. Logistics and delays at customs should not be our problems. I am happy the bank is helping to fix those for us.
Banking for the future will go beyond managing customers’ deposits: you need to vertically integrate into how the customers generate the cash.
A neobank that can deliver those other intangibles will win opportunities in Nigeria. Yes, structure the supply chain, assist on warehousing, etc, in addition to what banks do. And you do those things by making it clear that you know this customer. Our banks in Nigeria do not know us: they never demonstrate that because they have never offered any credit even though we have never asked. But the US bank uses algorithms to offer credits, adding a button on the dashboard in the app. If you click the link, the money will drop in 24 hours.
Essentially, they use the knowledge of your business to entice you to take credit without you even asking for it. They have memory and they simplify your frictions at scale. Doing those in Nigeria will open opportunities for neobanks.
Beyond Customer Need and Expectation, Perception is King of Market
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So, you consider responding to mails by Nigerian banks as minor customer service? Think again. How many of the big banks reply mails? They know themselves, and they are all here, on this platform. We don’t really have banking services here, just economic merchants hungry for profits, with minimal value delivery.
Businesses here are on their own, the banks only look in your direction when there is serious movement in and out of your account, then they will come around with their business-stunting loan packages, and all manner of savings plans for your unborn generations, ancestors and even your enemies; they are never wired to critically look at challenges facing businesses and develop capabilities to mitigate them.
We will keep singing unbanked population and financial inclusion song, without much success, because customers who are already in the system are looking for escape routes.
Just hot air everywhere.