E-Financial
CBN Sets September Deadline for Mutilated Notes
Central Bank of Nigeria (CBN) has said banks now have between June 3 and September 2, to collect and sort all mutilated notes in their possession for reissuing.
Mr Isaac Okorafor, central bank’s Director of Corporate Communications, who made the disclosure while engaging with leaders of organised labour in Lagos, said that “The CBN has given banks between the 3rd of June and September 2, to bring back all the mutilated notes for us to reissue them,” he said.
“And we are telling customers, including labour, that they should return all the notes to their bank. And that the banks will bring those notes to us for reissue.
“If any bank is refusing to take back the notes, they should call us and we will take action.”
In April, the bank had introduced a Clean Note Policy to put an end to the circulation of mutilated naira notes.
Meanwhile, at the engagement activity, which was part of CBN’s communication efforts to dialogue with key stakeholders in the economy, an Executive Member of the Nigeria Labour Congress, Issa Aremu, described CBN’s “creative intervention” in the Nigerian economy as “highly commendable.”
“CBN is working today because we have a competent hand,” he said. “Mr Emefiele is a man of vision, but he is also passionate about Nigeria, he is patriotic; we need to replicate that kind of public officer.
“Also, in terms of engagement, I haven’t seen the CBN engaging in any sort of controversy; he doesn’t go outside his mandate. What happens is robust engagement, such that both the executive and legislature agreed that he should go for another term. And the facts are all verifiable.
“They all talk about jobs that have been created; so you need similar kinds of personnel in the next cabinet of the Federal Republic of Nigeria.”
But Aremu noted that for the Nigerian economy to improve on its current growth levels, all hands must be on the deck.
“CBN is doing its own side of the bargain, but the other fiscal authorities must also complement the effort of the CBN,” he said.
For example, “CBN can’t do much to stop smuggling; so you have improvement in rice production, but by the time the farmers reach the market, it has been overwhelmed by smuggled rice.
“The same thing with textiles. So Customs must also sit up. Energy is also important. We need uninterrupted power supply. So we need the same activism that we are witnessing at the apex bank, at Customs, at the Ministry of Power. The Ministry of Trade and investment must sit up also; Ministry of Labour must sit up as well, because they are the ones to find out whether the funds are made available to investors in this sector are actually used for production and employment is being created.”
He added that “organised labour is committed to partnering with CBN to make sure that all these creative initiatives, in terms of development financing, are sustainable.”
The CBN Governor recently said the policies of the apex bank in the past five years had been focused on protecting the purchasing power of the poor and vulnerable persons in the country. According to Emefiele, the apex bank is very comfortable staying on the side of the weak, vulnerable, and poor masses and protecting their purchasing power.
He had argued the central bank’s development finance initiatives and foreign exchange intervention were targeted at supporting vulnerable persons in the society.
“The poor masses are the ones that bear the brunt of losing purchasing power of the meagre salaries they receive, ever so infrequently.
“Indeed, given the current resistance to pay increased minimum wage of N30,000, one wonders how the fixed income earner would survive the consequences of inflationary pressure arising from the pass-through from exchange rate depreciation being proposed by the naysayers,” he had said.
Emefiele said the task of building a stronger economy was far from complete; with the pace of Gross Domestic Product (GDP) growth still very fragile and badly lagging behind population growth rate of 2.7 per cent. He reiterated the fact that the level of credit to the private sector by financial institutions was still very low.
According to the CBN Governor, domestic industries particularly high employment generating sectors like textile and garment sectors have continued to deal with rampant smuggling and dumping of materials through our borders.
“These challenges no doubt call for action by the monetary and fiscal policies through the implementation of policies; the spirit and letter of which must be respected by all,” he added.
Central Bank of Nigeria (CBN) has awarded the country’s second Payment Terminal Service Aggregator (PTSA) license to Unified Payments, Nigeria’s premier financial technology company, following a rigorous and transparent process,
The move is targeted at enforcing existing requirement that all transactions from point-of-sale channels in Nigeria must go through a licensed Payment Terminal Service Aggregator (PTSA).
The CBN is enforcing the laws to clamp down on financial crimes and other market misconducts and it aligns with the CBN’s objectives to fully track all electronic transactions in Nigeria, given the propensity of using such transactions to fund insecurity, violent crimes, banditry, kidnapping as well as other vices.
According to one analyst, “By awarding a second PTSA license, the apex bank has proactively responded to industry operators who had expressed serious concerns about channelling all transactions through a single aggregator, the Nigeria Interbank Settlement System PLC (NIBBS), as has been the case for some years.
“With the new policy direction, payments service providers would henceforth route all transactions through either of the two licensed Companies.”
Other financial analysts and industry players have commended the Central Bank, affirming that “the move can be a massive step in the right direction. They also commended the open, transparent, and inclusive manner via which the selection process was managed, and the license awarded.
“The selection process, which lasted for months, began with an invitation for qualified organisations within the payment industry to submit an Expression of Interest document, alongside other requisite documentation and additional capital requirement of N1 billion.”
The new management of CBN decided not to give the license out without going through an open process – and for the first time in licensing a payment service provider – the apex bank went through a public bid process outlined in its publication of Friday, January 5, 2024, in different national newspapers. At the end of the process, Unified Payments emerged as the most preferred service provider.
Unified Payment Services Limited, also called Unified Payments or UP, is a shared service provider within Nigeria’s financial technology sector owned by a consortium of Nigerian banks. For over 26 years, the firm has provided payment technology to banks and other industry operators. The first and only non-bank entity that is a principal member and licensed acquirer of all of American Express, Mastercard, Visa, UnionPay and Payattitude. Unified Payments facilitates both local and international transactions.
Formerly known as ValuCard Nigeria Plc, Unified Payments led the way to introduce POS payments in Nigeria under its card scheme known as ValuCard which is the first payment card to be issued in Nigeria. The company later transformed into a scheme-neutral and option-neutral service provider enabling transactions under different schemes.
The company has continued to provide leading payment technologies and services, enabling different operators to leverage its capabilities and licenses, enabling prompt and seamless transactions.
Among the shareholders of Unified Payments are First Bank, Access Bank, United Bank for Africa (UBA), Guaranty Trust Bank Plc, Zenith Bank and Fidelity Bank. Other shareholders are Citibank Nigeria Limited, Ecobank of Nigeria Plc, First City Monument Bank Plc, Keystone Bank Ltd, Polaris Bank Ltd, Stanbic IBTC Bank Plc, Sterling Bank Plc and Wema Bank Plc.
Chartered Institute of Bankers of Nigeria, CIBN, has expressed support for the ongoing banking recapitalization exercise saying it will empower banks to lend more to the economy.
CIBN President, Dr. Ken Opara stated this yesterday while speaking at the annual lecture of the institute in Lagos, with the theme “Improving Availability of Credit in the Nigerian Real Economy: The Critical Importance of Liquidity.”
Okpara noted that the volume of credit to the real sector activities namely agriculture, manufacturing and services is low compared to their critical role in driving economic growth.
Consequently, he called for more credit to the real sector, saying, “I propose that we consider offering more credit to these key sectors and particularly the agriculture sector. It is for this reason that the Recapitalization exercise is a welcome development.
“The recently announced upward review of the Minimum Capital Requirements of Nigeria by the Central Bank of Nigeria would further empower banks to extend more credit to the economy’s productive sectors.”
To address these factors impeding credit to the real sector, Okpara suggested that, “The government needs to improve further the ease of doing business and infrastructural development, such as power, roads, rail networks, etc.
“Setting up industrial centres where these companies can co-habit and share common infrastructure. Harmonize and reduce the various taxes and levies, including locating them in a single hub.
“Banks need to be deliberate in de-risking these companies via Capacity building programmes, and Advisory services.
Specialised Financial Institutions can be created in addition to the Bank of Industry (BOI), especially credit guarantee agencies and risk-sharing institutions, to further facilitate the deepening of credit as practiced in countries such as China which significantly transformed its economy.
A new report claims that 20 per cent of Nigerians are using Bitcoin to carry out financial transactions every day.
According to the open-source blockchain website, Elastos, the research was compiled from online interviews conducted with 1,407 self-defined ‘tech savvy’ respondents in Brazil, Germany, Nigeria, South Korea, UAE, the UK, and the US.
The interviews were completed by a third party, a registered market research company and completed between 30 March and 04 April ’24.
The report further revealed that 67 per cent of Nigerians would have more trust in Bitcoin to put their life savings than banks and local governments.
The report reads; “The inaugural BIT Index (Bitcoin; Innovation & Trust) – compiled from over 1,400 self-defined ‘tech savvy’ respondents from 7 countries across the globe – sheds light on the actual perception and use of Bitcoin in people’s daily lives, irrespective of its current valuation. Elastos’ BIT Index is part of ongoing research to better track the ‘real world’ use of Bitcoin together with users’ motivations, expectations and barriers around the same.
“In particular, the data reveals the role being played by emerging markets in terms of understanding, usage and confidence around Bitcoin. Nigerian respondents’ levels of usage and trust compare starkly with those expressed from so-called ‘established’ markets such as Germany and the UK and Germany where daily usage levels are just 8% (for German respondents) and (9% for their UK counterparts).
“In terms of the trust – in addition to Nigeria – significant proportions of respondents from Brazil (35 per cent) and the UAE (32 per cent) would have more confidence in Bitcoin-based services to protect their life savings compared to those from markets such as the UK (20 per cent) and Germany (22 per cent).
“When it comes to ensuring the integrity of online transactions, emerging market respondents also revealed their relative confidence in Bitcoin, compared to alternatives. According to the data, 66 per cent of Nigerian respondents and 35 per cent from Brazil have more confidence in Bitcoin-based systems than alternatives such as banks, or national Governments, compared to figures of just 16 per cent (Germany) and 21 per cent (UK) who feel the same.
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