THE DISADVANTAGES OF AGENCY BANKING IN NIGERIA'S FINANCIAL SECTOR

The study was conducted to investigate the downside of agency banking in Nigeria using Enugu South LGA of Enugu State as a case study. This study adopted the survey research resign. The survey was designed to elicit responses from respondents on the downside of agency banking in Enugu South LGA of Enugu State, Nigeria. The source of data was primary, obtained through the administration of questionnaire to agent bankers (POS operators) within the area of study. The population of the study consists of all POS operators in Nigeria. The sample size was calculated using the general formula for determining the sample size of an unknown population. The study used both descriptive and inferential statistics and the hypotheses were tested at 5% level of significance. It was found that robbery and liquidity shortage militate against the operation of agency banking. The study therefore recommends that the agent banker should ensure the availability of adequate cash that can reasonably serve customers without running into shortages or surplus of money while the government and commercial banks should partner in ensuring adequate security necessary for the operation of agency banking in Nigeria.