Daily Insight – E-payments in Nigeria: Improved efficiency amid stiffer regulations

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The Nigeria Inter-Bank Settlement System (NIBSS) recently released its e-payment fact sheet for the first half of the year. As at Jun-18, the total number of active individual banking customers accelerated to 67.7mn from 59.0mn recorded as at Dec-17. Furthermore, the number of corporate and individual accounts inched higher by 25.0% and9.5% to 7.5mn and 102.1mn respectively between Dec-17 and Jun-18.

What’s more, the volume of cheques processed by the agency over the first half of the year, diminished by 10.6% to 4.7million units when compared to the same period last year, while the volume of transactions via NIP (Internet Banking, Mobile ATM, POS, USSD and bank branches) platforms spiked by 105.0% to 36.9million.

Meanwhile, the CBN recently issued regulations for the efficient operation of instant electronic funds transfer services in Nigeria effective 2nd October 2018. Among others, the regulation requires that banks and other providers of e-funds transfer services must submit an annual enterprise risk management framework to the CBN, maintain an approved robust anti-fraud management framework, permit transfers from all its services channels and are liable to a sanction of N10,000 per item for every failed NIP transaction not reversed to the customer’s account within 24hours.

Juxtaposing the data trend with the freshly released CBN regulation and sanctions, we expect financial services institutions to ramp up the efficiency of their
electronic platforms for service delivery, hence, ultimately adding value to customers.

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