CBN slams Customs for sabotaging drive for e-transactions

By Lukas Ajanaku, Lagos, Nigeria

Efforts of the Federal Government of Nigeria, through the Central Bank of Nigeria (CBN), to institutionalise a cashless society and reduce the huge sum of money spent on cash management by the apex bank is being frustrated by the “recalcitrant” attitude of officials of the Nigeria Customs Service (NCS), Tunde Lemo, deputy governor, Banking Operations, CBN, has lamented.

According to figures from the the Nigeria Interbank Settlement System (NIBSS), it costs the CBN and other banks in the country over N100 billion annually to manage and process cash transactions in the country.

Lemo, who spoke in Lagos at the annual lecture organised by Committee of e-Banking Industry Heads (eBIHs) at Oriental Hotel, Lekki, lamented that officials of the NCS were withholding the clearance of some 40,000 point of sales (POS) machines ordered by the banks with the support of the CBN.

According to him, the NCS is insisting on collecting 20% duty on the machines contrary to the five per cent duty that POS machines traditionally attract.

Lemo said the items were erroneously classified as “cash register.” He lamented that despite the fact that he had personally written a letter to the Customs high command, the management con5tinued to be “recalcitrant” on the issue, arguing that the only way to transform the economy in line with FSS 20:2020 and Vision 20:2020 of the Federal Government which aims at financial inclusivity and making the national economy one of the twenty leading economies in the world respectively.

The CBN deputy governor spoke against the backdrop of the launch of the pilot programme of chashless society expected to kick off next year in Lagos. Tagged Cash-less Lagos, Lemo said one of the factors salient for sustainable economic development is the national payment system. He said aside bleeding the national economy, cash society allows corruption, armed robberies and other vices to thrive.

On security of electronic transactions in the country against the backdrop of dearth of legislation to address e-fraud and frauds perpetrated through the use of automated teller machines (ATMs), Lemo said there has been a drastic reduction in the rate of ATM frauds in the country.

According to him, the rate has reduced to less than 10 per cent as the industry now has 99% reduction in ATM fraud, giving the praise for this to e-fraud forum which has worked to nail the fraudsters.

He identified other constraints besetting the project to include power, slower adaptation, dearth of human capacity and high level of illiteracy. “It is expected that the reform in the power sector will address the problem. Best global practices will also be made to work in the country,” he said adding that the CBN is committed to institutionalizing stable and virile economy in the country.

Speaking on preparedness for the pilot Cass-less Lagos scheme expected to begin 1 January next year, Niyi Ajao, general manager, NIBSS, said the agency has established cheque truncation initiative which, according to him will ease the problem associated with prompt cheque clearance.

Another initiative he said will allow a smooth take-off of the programme is the NIBSS Electronic Fund Transfer (NEFT).

He added that with the introduction of the Central Mandate Management System (CMM), it is now easy to do direct debiting on accounts, arguing that in other parts of the world people no longer queue to pay for subscriptions like DSTV.

Others are the NIBSS Instant Payment (NIP)Nigetria Central Swtch (NCS) and Payments Terminal Serviec Aggregators which was set uip to provide reliable, secure and dedicated data channel for POS transactions.

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