Mobile money gets boost as CBN loosens restriction on telcos

Mobile money

Mobile money

02 September 2015, Lagos – With the review of the mobile money guidelines, which allows for the participation of the telecommunication companies, the adoption of this form of banking is expected to get a significant boost.

Surveys had attributed the slow pace of adopting the mobile money services to the low public awareness on the payment transfer system. Another challenge had been low number of agents as well as inadequate infrastructure. Already, three of the telecommunication companies in Nigeria have already applied for super-agents license to render mobile money services.

But the Central Bank of Nigeria, CBN, has stated that it decided to review its policy on mobile money to accommodate the telcos because it realised that they, telcos, have huge infrastructure and actually provide the enabling infrastructure for mobile money agents to work.

“The telcos have outlets and so they can come in as super-agents, which means, we can leverage on some of these infrastructure to provide mobile financial services and that is basically what we are doing. So, all outlets of the telecommunication companies are going to act as agents,” the Deputy Director, Banking and Payment System Department, CBN, Mr. Musa Itokpa Jimoh advised.

From July next year, the capital requirement for being a mobile money operator shall be N2 billion The CBN introduced mobile money services to provide basic financial services and create payment access especially to Nigerians without bank accounts, as well as to help drive financial inclusion in the country.

Mobile money is a tool for economic growth and development, if fully explored. It enables monetary transactions to be done on mobile phones through text messaging. Also, it serves as an alternative way of storing money, for both account and non-account holders. It reduces the risk of theft and loss of money as it does not involve the handling of cash.

Through this service, an individual can make money deposits, pay bills, transfer funds and pay for goods and services purchased.

Meanwhile, as a result of the challenge of frequent complaints of network failures being reported by points of sale (PoS) merchants, the central bank has taken steps to improve efficiency of the device and customer usage. The banking sector regulator also attributed the network interruptions partly to the duplication of the device.

“At one merchant location you can have 10 and the merchant needs only one. So, technically speaking you have just given them PoS terminals that would not work. So, what we are doing now is to clean up and to say we don’t want to see more than two PoS terminals in any location.

“What we do is to make sure that if a terminal is there and it is not doing any transaction, we deactivate it. So, any terminal that has not done transaction in the last three months is considered not active and what we do is to deactivate it. Once we deactivate it, we now have the true number of PoS terminals that are working in the country,” Jimoh explained.

He said the deactivation process is on-going, adding that it is being by the Nigerian Interbank Settlement System (NIBSS), which is the aggregator is the organisation handling that.

“NIBSS is the aggregator and is the one that knows the terminal that has not been active,” he added.

Continuing, Jimoh advised bank customers to always keep their cards safe so as not to be victims of fraudsters.

“Your card is never safe until you protect it completely from everyone. The 16-digits in front of your card which is called the pan are very dangerous. Do not allow anybody to snap it and in front of that card you have the expiry period and when you turn the card the other way, you have the three digits called the Card Verification Value (CVV).

“Those three pieces of information are very vital and if you give your card out and feel you still have your pin, you might be making a mistake. Those of us who send our drivers out with our cards, if anybody gets hold of the 16 digits, the CVV and the expiry date, that person can go on the internet and buy goods with it,” he added.

*Obinna Chima – Thisday

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