Tuesday, October 19, 2021

FNBB freeze accounts over out-of-date customer details

An admission of a technical glitch over frozen bank accounts landed the country’s leading bank, First National Bank Botswana (FNBB) in trouble with some of its customers this week.

By late Friday afternoon, some of the First National Bank Botswana account holders were angered when they were unable to withdraw or send cash from the bank’s Automated Teller Machines (ATMs) or through online banking.

The market leading bank was not spared of a backlash, including threats of switching banks, which was publicly displayed through the social media. Nearly five hours after releasing its apology statement on its official Facebook page, the post had 79 shares, 199 comments and 127 reactions.

The bank linked the account freeze to the ongoing process of ‘Know Your Customers’ (KYC) which requires that financial institutions’ customers submit documents for the institutions’ knowledge of who their customers are.

Through KYC, FNBB, and other commercial as well as non banking financial institutions are updating their services, which requires account holders to submit updated proof of addresses and identification numbers.

This is per the Banking Regulations and as such is an obligation of the financial institutions to collect such information. The process is intended to assist financial institutions to identify and respond accordingly to suspicious transactions which are then reported to the Central Bank.   

“FNB Botswana informs customers whose accounts were frozen on the batch of the 16th November 2017 that the Bank will unfreeze their accounts within 24 hrs. The Bank experienced a technical glitch during the freezing exercise of the said batch and would like to sincerely apologise to all affected customers for the inconvenience caused,” reads its statement on Facebook.

Despite the bank’s apology, its customers did not express understanding to the matter. Instead they went on to detail specific instances of the humiliation they suffered because of their accounts being frozen. By Friday evening, the customers’ continuos feedback on the FNBB Facebook page clearly conveyed disappointment and degradation of their dignity resulting from failed payments due to the freeze.

The Botswana Stock Exchange (BSE) quoted bank on the other hand gave its customers several months notice, via e-mail and Short Message Services (SMS), regarding the KYC process. During the campaign period, the bank warned that those who did not submit their updated details that they would find their accounts on hold temporarily.

“All customers who have not yet submitted KYC documents are encouraged to submit at their nearest branch”, reads part of the FNBB statement on KYC circulated on the bank’s Facebook page on Friday.

Still on Friday, the bank said the customers whose accounts were frozen on the batch of the 16th November 2017 will be activated.

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