CBN allays fears on implementation of cash-lite project

The Central Bank of Nigeria has said that concrete steps are being taken to address all issues that will constrain the implementation of the Bankers Committee initiative to promote e-payment in the country. According to a statement by the Head of Shared Services Department, CBN, Mrs. Eyitope St. Matthew-Daniel, the transformation of the payment system is a major plank of the shared services programme, whose target is to significantly reduce costs in the banking industry by a minimum of 30 per cent. The statement added that the successful implementation of these initiatives would impact positively on industry cost structure, which banks were expected to ultimately pass on to their customers by way of lower charges. St. Matthew-Daniel said that in 2009 alone, the direct cost of cash management borne by the banking industry was N114.5bn and was projected to reach N192bn in 2012.He added that, "This burden is imposed on the industry only because transactions in the economy are largely cash-based. Unlike what obtains in the developed economies, Nigerians rely heavily on cash to make payments for their purchases."Eyitope pointed out that cash related transactions currently represented about 99 per cent of customer activities in banks. She added that only about 10 per cent of these transactions were in excess of N150, 000, which explained the daily withdrawal and lodgment limit placed on individuals under the cash-lite policy. Under the project, which commences from January 2012 with Lagos as a pilot state, individuals making daily withdrawals/lodgments exceeding N150,000 will have to pay N100 for any additional N1,000 while companies withdrawing/depositing more than N1m will be required to pay a penal fee of N200 for any additional N1,000. According to the statement, it is envisaged that these penal rates will serve as an incentive for Nigerians to migrate to alternative channels of payment such as Point of Sales, Internet and electronic funds transfer. The statement added, "To facilitate the migration and seamless implementation, the Bankers Committee is aggressively putting in place a number of measures including an increase in POS penetration. The plan is to increase the number POS terminals from about 5,300 currently to 150,000 by 2012."
Click here to read full news..