Electronic payment will curb money laundering, corruption
The Governor of the Central Bank of Nigeria (CBN), Mallam Sanusi Lamido Sanusi, Monday said the effective implementation of the electronic payment system in both private and public sectors would be “the biggest blow” on money-laundering and corruption often perpetrated as a result of the huge size of cash transactions.
Speaking in Abuja at the opening of an international conference on ‘Payment System and Launch of the Payment System Vision 2020 Strategy (Release 2) Document’, Sanusi said the CBN would over the next few years concentrate on strengthening institutional and regulatory frameworks that would encourage the development of the payment system, increase financial inclusion and promote more usage of electronic payments.
He explained that the revised document would henceforth ensure that no national payments system would invoke the principle of unwind.
He added: “The CBN will formally inform the industry that unwinds must not be invoked in any national payment system. Each payment scheme must define and formally document the exact point at which payments are deemed to be final and irrevocable.”
Sanusi further noted that under the updated strategy document for payments system, the implicit role of the central bank as ‘lender of last resort’ for Real Time Gross Settlement (RTGS) payment system would be terminated by December 2016 as well as the Deferred Net Settlement system by December 2019.
He said there was need for best practice and improved collaboration across various levels, adding that effective payment system could not be achieved without technology providers and regulators of the communications technology sector.
However, the CBN boss said the country’s payment system was still plagued by infrastructure deficit including power and communications network, illiteracy, slow adoption, lack of effective national identity among others.
Sanusi said the draft National Payment System Bill, which is still being considered for approval, would address legal barriers to electronic payment in the country. He added that ongoing implementation of biometric solution as part of requirements for opening of accounts would also solve the problem of unique identifier.
The central bank boss noted that the revised PSV2020 document would further usher in the emergence of a new collateral management for all the deferred net settlement systems.
On her part, the Minister of Communications and Technology, Mrs. Omobola Johnson, said government was working to make the internet safer for the active participation of more Nigerians through the approval of the Cybercrime Bill by the Federal Executive Council (FEC).
She also said efforts were ongoing to deploy critical infrastructure in rural areas to further drive the digitisation process.
Meanwhile, the CBN yesterday reiterated that its Consumer Protection Department was established to ensure that consumers of financial services get maximum benefit from banks. Addressing journalists in Kano yesterday, the Deputy Director, Consumer Education, CBN, Hajiya Khadijat Kassim, said when the present management of the central bank assumed duty in 2009; the financial system was at the brink of collapse.
She said: “There was crisis in the financial and capital market which had been triggered by the global financial crisis at the time.”
According to her, in line with the mandate of the CBN to promote a sound and stable financial system as enshrined in the CBN Act, the consumer protection department was saddled with the responsibility of regulating the conduct of financial service providers so as to engender trust and confidence in the financial system.
Specifically, Hajiya Kassim said consumer protection department functions amongst others include, enhancing consumer financial capability through consumer education, ensure fair and responsible market and business conduct amongst financial service promoters.
“It is important that the consumers are given reasons to trust the system and therefore be confident in dealing with financial service providers,” she said.