The Central Bank of Nigeria (CBN)’s recent deadline for the country’s 200, 500, and 1000 naira notes to stop being legal tender has resulted in a battle for many citizens as they struggle to keep up with online transactions and mobile payments. With banks unable to provide enough new 200, 500, and 1000 naira notes and ATM points either dispensing old notes or none at all, Nigerians have been left stranded and have to resort to using Point of Sale (POS) merchants to get money. However, these merchants are just as overwhelmed and some have begun taking advantage of the scarcity of the new notes, extorting customers for their services.
This has further resulted in many Nigerians turning to mobile transfers as a solution, but this too has proven to be a challenge. People have been complaining that money transfers are not going through. On more than one occasion, I have had to wait almost 24hours for a transfer to reflect. This makes me and many others worry that the retail banks’ infrastructure seems unable to handle the increased amount of transactions being processed as a result of the CBN deadline.
With Nigerians unable to access new notes over the counter, the sudden increase in mobile transfers demand looks like it has put a strain on the technology infrastructure of retail banks, causing the servers to become overwhelmed and leading to slowdowns or even failures in processing transactions. From all indication, the servers are not able to handle the increased volume of requests for information, leading to bottlenecks and slowing down the entire system.
On another hand however, last week, some Microsoft tools had a global outage and Azure, Microsoft’s global cloud computing platform was reportedly affected. What are the odds that this could be causing bank apps to malfunction and transactions to fail? The possible connection between the Azure outage and the difficulties being experienced by the banking system in Nigeria has created a great deal of speculation and discussion among experts.
For context, Microsoft Azure is a critical component of the technology infrastructure for many financial institutions and businesses around the world, including many banks in Nigeria. The disruption to the platform could potentially impact the ability of these banks to process transactions and provide services to their customers. Not to be overtly dramatic but this raises some concern on the reliability and resiliency of cloud computing platforms, and their ability to support the critical (ever expanding) functions of financial institutions.
While it is too early to say for sure whether the alleged Azure outage is the cause of the difficulties being experienced by the banking system in Nigeria, the situation highlights the need for robust and resilient technology infrastructure to support the growing trend towards digital transactions. The hope is that the Nigerian financial sector will work to find a solution to the current challenges and ensure that citizens are able to access their money and make transactions easily, securely and timely.
