THE Nigeria Inter-Bank Settlement System Plc (NIBSS) has begun what it described as T+1 settlement of POS transactions, processed through Valucard Nigeria Plc, as part of its preparations for the cashless Lagos project.According to the company, the T+1 settlement rule was designed to ensure that business concerns that accept payments through Point of Sale (POS) devices receive value for their daily sales the next day.It was learnt that before then, banks used to settle merchants on the third day (T+3).The T+1 settlement regime on Point of Sale (POS) Card Acceptance Services was released in August this year. The concept was introduced by the Central Bank of Nigeria (CBN) to encourage merchants to accept card payments in place of cash, as part of the Cashless Lagos drive and is critical clause in the guidelines on POS services.Giving insight into the operations of the new settlement system, the statement explains that NIBSS, through its automated bulk clearing bureau, now carries out T+1 settlement into bank accounts of merchants who accept card payments on POS terminals using its Electronic Funds Transfer (NEFT) service. NEFT as it operates today, enables same day (direct credit and direct debit) electronic fund transfers based on bank account numbers, through bank teller points, Internet banking, mobile phone, e-commerce and other modern payments service delivery channels.According to the General Manager of NIBSS, Mr. Niyi Ajao, the new scheme provided security, ease of use, accessibility, convenience and efficient settlement and reconciliation functionalities and was available in all banks in Nigeria.Ajao who was excited about the commencement of the T+1 settlement scheme, stated, 'with the commencement of the T+1 settlement for POS transactions by NIBSS, the banking industry has again shown commitment to the success of the Cashless Lagos project. The T+1 settlement scheme is intended to make card payments more attractive to business owners, whether big or small and to further encourage the use of POS devices for business transactions.The Deputy General Manager (Operations), Mr. John Obiekwe, affirmed that the commencement of T+1 settlement would create better value for business organisations and financial institutions, who would now have to worry less about the issue of cash handling.He stressed, 'a major concern in the Cashless Lagos project was about how quickly merchants can get value from their transactions done through POS channels, and that is why the CBN has directed the T+1 settlement scheme.
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