By Olusegun Obisanya
The Central Bank of Nigeria, CBN, has launched the Nigerian National Domestic Card Scheme with the objective to strengthen payment system and further drive financial inclusion.
Describing the launch as an epoch-making that signals a major step to drive a thriving and competitive payments landscape in Nigeria, the CBN Governor, Godwin Emefiele, in a statement, noted that Nigerian banking community has risen up to the challenge of payment system.
Emefiele stated this in his keynote address in Abuja on Thursday at the brand unveil and virtual launch of the Nigerian National Domestic Card Scheme (NNDCS).
The Governor said, “The Cashless Policy which commenced in 2012, signposts our common drive to strengthen the national payment system and deepen the usage of electronic platforms in Nigeria.
“In line with the National Payments System Strategy, the CBN has been deliberate in collaborating with relevant stakeholders to enhance the national payments infrastructure through initiatives such as the Bank Verification Number (BVN), Real Time Gross Settlement System (RTGS), Shared Agent Network Facility (SANEF), Regulatory Sandbox, Open banking and the eNaira, the Central Bank of Nigeria’s Digital Currency, to mention a few.”
In addition, the governor remarked that the cashless policy has created value, engendered competition and attracted investment into the Nigerian banking and payments ecosystem.
“We have witnessed the proliferation of products, channels and participants with significantly increased foreign direct investments into the Nigerian payments space. The CBN has also over time focused attention on robust development of financial service touch points including the ATMs, POS terminals and agent networks.
“The success of the Shared Agent Network Expansion Facility has led to growth in the number of agents to about 1.5 million across the Federation with the capacity to accept card payments from Nigerians,” Emefiele posited.
Continuing, he stated, “Given the limited usage of cards by Nigerians and in a bid to deepen penetration, the Bank actively promoted the National domestic card scheme which will be accessible to all Nigerians and also address our local peculiarities. This Scheme is therefore an important plug in the gap that has remained with us since the cash-less policy was introduced.”
He noted that by the introduction of the card schemes, Nigeria has join countries like China, Russia, Turkey and India who have launched domestic card schemes and harnessed the transformative benefits for their respective payments and financial systems.
The CBN said it is committed to a robust, efficient and safe national payments system and therefore welcome innovation from both domestic firms and foreign investors, adding that the Nigerian market is vast, and there is much ground to be covered as millions of Nigerians are yet without payment cards to consummate transactions.
CBN Governor posited, “I am convinced that the National Domestic Card Scheme will make this a reality in the coming months. We can no longer neglect the vast majority of the Nigerians whose daily payments needs are micropayments. We need to capture them in national statistics to further understand their transaction dynamics and properly target interventions in that sector of the economy.
“Indeed, the National Domestic Card Scheme bodes opportunities for our economy to integrate the informal segment of our economy, reduce shadow banking, bring more Nigerians into the formal financial services with attendant diversification of deposit portfolio which will further strengthen the stability of the banking industry.”
In her remark, the Deputy Governor, Financial System Stability, Central Bank of Nigeria and Chairman, Nigerian Interbank Settlement System (NIBSS), Mrs Aishah Ahmad described the introduction of the card schemes into Nigeria’s economy as a momentous milestone.
“As you are aware, technological advancement, rapid innovation in financial and payment services and the forward thinking regulatory stance of the CBN have offered us unique opportunities to drive cashless transactions, boost financial inclusion, deepen the financial system and promote inclusive economic growth. Indeed, the evolution of the Nigerian payment system witnessed today is an achievement we are all very proud of.
“The National Domestic Card Scheme is momentous development for a number of reasons, not in the least the data sovereignty it confers, cost savings for the industry; it heralds a new vista of opportunities for the card business, that several countries continue to recognize and leverage as they create their own domestic card schemes to augment existing foreign payment card rails,” she said.
Ahmad saw the card schemes as an important platform for further innovation to solve pressing issues around financial inclusion, SME payments and trade facilitation. According to her, the initiative will also support the drive for a robust digital economy for the Nigerian market, the African continent and the world.
