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CBN Begins Review of Payment System Vision

Governor of Central Bank of Nigeria (CBN), Mr. Godwin Emefiele

….to extend targets to 2030

The Central Bank of Nigeria (CBN) has commenced a review of Payment System Vision (PSV) with the view of extending the targets to 2030.

The PSV strategy was launched in 2007 with 2020 target to make the Nigeria payment systems internationally recognised, nationally utilised and provide a sound regulatory framework that supports innovation, protects consumers and promotes financial stability.

This was revealed by the Deputy Governor, Financial System Stability (FSS) of the CBN, Mrs Aisha Ahmad, at the 2019 Electronic Payment Incentive Scheme (EPIS) Efficiency Awards held in Lagos.

According to her while progress has been made in the industry, electronic transactions were yet to reach desired levels.

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Ahmad, who also doubles as the Chairman of the Nigeria InterBank Settlement System (NIBSS), noted that in spite of the milestones and achievements recorded with electronic payment channels, “we are not yet at the goal.”

“Electronic transactions are not yet at desired levels, increasing digitisation heightens cyber security threats while policymakers are faced with the twin but often conflicting objectives of fostering technological innovation whilst managing the risks to financial stability,” she added.

She noted that in furtherance of the payment system objectives and in response to developments in the industry, “the CBN is undertaking a review of the PSV 2020, which was created to provide a sound regulatory framework that supports innovation, protects consumers and promotes financial stability. The proposed refreshed strategy is tagged PSV 2030.

“The payments system has changed significantly and continues to evolve. New technologies and a growing number of financial technology companies in the markets are supporting faster payments and settlements.

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“Technological advancements and the adoption of mobile as the primary channel have also made it easier and cheaper to conduct electronic transactions.

“These developments are validated by the astronomical increases in transaction volumes in virtually all electronic payment platforms.”

Quoting data provided by NIBSS, she said ATM transactions have risen by over 196 per cent, from 295 million in 2013, to 875 million in 2018, while point of sale transactions rose by 3,076 per cent from nine million in 2013, to 285.89 million in 2018.

She noted further that electronic transfers via web had improved by 2,440 per cent from two million in 2013 to 50.8 million in 2018.

“Contrastingly, paper-based payments transactions using cheques declined by over 35 percent between 2013 and 2018, 14 million transactions conducted using cheques in 2013 relative to nine million transactions in 2018,” she added.

She appealed to industry players to continue evolving round technology in developing their products and services in order to achieve the news target of 2030.

“To achieve this objective, industry operators must scale up their capacity to innovate by developing unique products that provide the convenience and security that customers desire; enhance the capacity of their systems to handle significant volumes of e-transactions while also maintaining the efficiency of these platforms,” she appealed.