Have you ever transferred money from one bank to another bank? Yes. Do you know how it works? Sometimes they’ll tell you, I haven’t gotten the money. At other times Immediately you just finish, you just get, ah, chief. I don’t get the money. Correct guy. Let me show you how it works.
All the banks in Nigeria are connected by one switch called the NIBSS. The NIBSS stands for the Nigeria interbank settlement system.
It is owned by all licensed banks including the Central Bank of Nigeria and it started operations in 1994. Whenever you try to transfer money from like access bank to a GT bank, or from Zenith bank to UBA, it must pass through NIBSS. And this happens in microseconds.
If there is as little as a small downtime, your transaction will not go through. But if system is perfect, the person will receive the money.
So if you want to transfer money from Axis bank to UBA, it must pass through NIBSS before it gets to UBA. If you try to transfer money from GT bank to FCMB, it must pass through NIBSS to FCMB.
Now imagine all those banks are transacting at the same time millions of transactions per day. Now if this NIBSS is down, if they have a downtime, no matter how good the network of all these other banks are, as long as this one has a problem, it will not go.
Now that is part of the problem in the Nigerian banking system. Because the NIBSS is burdened with all transactions, whether transfers, POS transactions, all of them, you tend to have a lot of downtime.
To be fair, they’ve been doing an amazing job. I feel there should be like a competition or some other company. Because no matter how good GT Bank network is or Access Bank or Zenith or UBA, all of them, once NIBSS has an issue, your transfers, your transactions, POS, all of them will be failing.
So sometimes when you go to your bank and they are telling you it’s not our fault, it’s not us, it’s NIBSS, those are the guys you are talking about, NIBSS. So now you know how your transfers go and what and who is in charge of all of them.
Watch The Video Tutorial Below For More Details 👇
I hope this makes sense to someone out there.