CBN STOPS NIGERIA CENTRAL SWITCH MONOPOLY DRIVE
Source: FinancialtechnologyAfrica.
The Central Bank of Nigeria (CBN) has stopped the Nigerian Central Switch
(NCS) drive to decree itself into a monopoly in the e-payment sector of the economy. At a
meeting with all the stakeholders in the e-payment, the apex body through its Deputy
Governor, Mr. Tunde Lemo reversed almost all the prayers sought by NCS. Present at the
meeting were the switching companies, card schemes, Independent ATM Deployers (IADs) and the
banks. All contentious issues surrounding the operations of the NSC were reviewed.
According to the Operational Rules and Regulations for the NCS released by the CBN, “The NCS
is designed to provide interconnectivity and interoperability amongst approved electronic
fund transfer (EFT) switch initiatives in Nigeria.
However, NCS had in recent times mandated banks in the country to connect to it on or before
14th May, a development that did not go down well with the switches, IADs and some of the
banks. Besides, NCS had also ordered the IADs not to connect to any other switches except
NCS.
Earlier, NCS had wanted to connect to MasterCard and VISA through the banks, claiming that
it had no business undergoing the often mandatory certification from these global payment
brands. Sources at the meeting say Lemo frowned at a situation whereby the “value creators”
would be muscled out of the e-payment business by a monopoly that was decreed into
existence.
Accordingly, the CBN directed that IADs can connect to the switches based on agreed
commercial bi-lateral arrangement. While the banks can connect to NCS, connections to the
switches are based on pre-agreed commercial bi-lateral arrangements.
CBN therefore encouraged NCS to undergo all the card scheme certifications in readiness for
transaction processing. The Bankers Committee in 2005 initiated the establishment of the NCS
to be operated by the Nigeria Interbank Settlement System (NIBSS), and which would connect
all the banks and card schemes (switches), hence, making it possible for banks customers to
use their cards on any payment device irrespective of the owner.
[...] This post was mentioned on Twitter by MMIT, Emmanuel Okoegwale. Emmanuel Okoegwale said: CBN STOPS NIGERIA CENTRAL SWITCH MONOPOLY DRIVE http://tinyurl.com/2e2xqwo [...]
[...] Mobile Money Africa » Blog Archive » CBN STOPS NIGERIA CENTRAL … Share and [...]