E-Financial
Cheque Truncation, NEFT Battle for Life
The cheque truncation system of the Central Bank of Nigeria (CBN) is threatening the life of Nigeria Electronic Funds Transfer (NEFT) system, an irrevocable fund transfer instruction because the former now offers faster cheque clearing cycle, Nigeria CommunicationsWeek can now report.
Unlike the drudgery associated with NEFT, cheque truncation now eliminates the need to move the physical instruments across branches, except in exceptional circumstances; making the realization of proceeds of cheque possible within the same day.
Investigations showed that this new instrument is in hot demand as customers seek to reduce the time taken to clear the cheques.
Mr. Oluwaseyi Agboola, ICT vendor at the popular computer village narrated how his customer who uses Ecobank Plc gave instruction for certain amount of money to be transferred to him on a Friday only for him to get value in his Sterling Bank account on Tuesday morning.
He said: “This is equivalent to old system of cheque clearing I will rather go back to cheque which has improved than wait forever for NEFT to come.”
Nigeria CommunicationsWeek gathered that NEFT passes through the same clearing circle like cheque.
The delays in NEFT are often caused by some banks that are reluctant to carry out instructions especially when it concerns paying out money to another bank.
Bindesh Pandey, regional manager, West Africa, Newgen Software Technologies, said that Nigerians trust cheque more than electronic transfer and thereby prefer the use of cheque especially now that the days of clearing has been reduced to one day.
But that is not to take the shine off NEFT, the good old instrument because the payer’s bank simply will not accept the order if there are insufficient funds to cover the payment instruction.
Tunde Lemo, Deputy Governor, Operations, CBN, disclosed last week that the Nigeria Interbank Settlement System (NIBSS) recorded over N20billion daily transaction by value, while the Nigeria Electronic Funds Transfer (NEFT) conducts about N60billion transactions daily.
NIBSS provides the infrastructure for automated processing, settlement of payments and fund transfer instructions between banks, discount houses and card companies in Nigeria.
Nigeria CommunicationsWeek gathered that some of the payments that can be effected with NEFT Credit Transfer service: individual (person-to-person) fund transfers; merchant payments that is payments for goods and services; payment of tuitions; individuals paying utility bodies (water, electricity, telephone bills, Multichoice, FSTV, etc.); revenue collections by government agencies e.g. Customs, FIRS; and distributor payments.
Others are; government taxes; subscription payments (magazines, clubs, associations, etc.); charity donations; and payment to religious bodies (churches, mosques).
The NEFT is quite similar to the GIRO payment method which has become popular in Europe and other parts of the world.
The NEFT payment system provides additional consumer payment option and allows for 24-Hour credit transfer system, with a nationwide coverage for transfer instructions cleared through the Lagos Clearing House.
Bank transfers are more secure for both the customer and the banks and there are no cheques that may be misplaced, lost or stolen. In addition, since the payment goes directly from the customer to the bank, there is no possibility of fraudulent alteration of the payment amount.
Cheque truncation system on the other hand is basically an online image-based cheque clearing system where cheque images and Magnetic Ink Character Recognition (MICR) data are captured at the collecting bank branch and transmitted electronically.
Truncation means, stopping the flow of the physical cheques issued by a drawer to the drawee branch.
The physical instrument is truncated at some point en route to the drawee branch and an electronic image of the cheque is sent to the drawee branch along with the relevant information like the MICR fields, date of presentation, presenting banks etc.
Cheque truncation substantially reduces the time taken to clear the cheques as well enables banks to offer better customer services and increases operational efficiency by cutting down on overheads involved in the physical cheque clearing process.
E-Financial
Access Pensions Reaffirms Commitment Towards PBMs for Nigerians
Access Pensions has emphasized its commitment to offering thorough guidance and assistance to customers interested in Pension Backed Mortgages (PBMs).
Head of Customer Experience at Access Pensions, Ophelia Alex-Iwuanyanwu, reiterated this commitment during a recent webinar organised by the company.
She also highlighted the Access advantage, showcasing the robust financial ecosystem provided by Access Corporation and how the firm is committed to ensuring the best for its customers.
Additionally, Chief Investment Officer, Access Pensions, Wale Okunrinboye, Regional Head, Business Development, Adaeze Raji and Head of Benefits Administration, Access Pensions, Zainab Bello, provided valuable insights to webinar attendees, offering tips to enhance pension planning security and manage personal finances effectively.
They reiterated the company’s commitment to delivering top-notch relationship management services. Alex-Iwuanyanwu said, “We offer competitive pension backed mortgage finance tailored to your needs, ensuring your goal of home ownership is achieved.
“We also guide our customers through every step of the homeownership journey, starting well before the application reaches us. We offer end-to-end guidance from our team to ensure a simplified process that reduces the turnaround time, from initiation to PENCOM’s approval.”
She further added that clients benefit from dedicated relationship managers, access to digital channels, financial literacy programs and superior investment returns. Additionally, efficient benefits administration ensures timely pension payouts globally.
Also, Okunrinboye, speaking on “Investment Management: How do we manage your pensions” said: “Our investment process is built around applying an analytical approach to securities analysis, asset allocation, optimal trade execution and a quantitative approach to risk management.”
Furthermore, Raji discussed the essential steps to achieve retirement goals, emphasising the importance of setting clear income targets and developing a comprehensive plan to achieve them. She noted that this involves identifying income sources, assessing expenses, establishing a savings strategy, and effectively managing assets and risks.
Bello delved into the specifics of pension benefits. She outlined the eligibility criteria for accessing retirement benefits, which include various circumstances such as mandatory or compulsory retirement, retirement due to medical reasons, or temporary loss of employment.
Additionally, she highlighted the factors that determine the amount payable to retirees, including gender, the total balance in the retirement savings account (RSA), final salary details, and the age at which retirement occurs.
The webinar, hosted by Head of Brand and Communications, Mojisola Coker, provided an enlightening platform for customers to engage in a question-and-answer session, fostering valuable insights.
E-Financial
Former SEC Leadership Failed to Regulate, Develop Capital Market- ASCSN
Senior Staff Union under the aegis of Association of Senior Civil Servants of Nigeria (ASCSN) of Securities and Exchange Commission (SEC) has accused the past administration of the Commission led by Dr. Lamido Yuguda of failing in its mandate of effectively regulating and developing the capital market, which is an intricate part of the nation’s economy.
ASCSN also urged the federal government to exempt workers of the commission from 50 percent operating surplus remittance
Abba Mamman Ali, chairman of the Union, stated this on Monday during a briefing with journalists in Abuja.
Recall that President Bola Tinubu had last Friday sacked Dr. Lamido Yuguda, former director general and announced a new management and board for the Commission.
While Mr. Mairiga Aliyu Katuka is the chairman of the new board, Dr. Emomotimi Agama is the new director-general.
Abba said the administration of the Yuguda “failed in its mandate to effectively regulate and develop the capital market, which is an intricate part of the Nigerian economy.”
Furthermore, he said the Yuguda-led Management “was insensitive and unresponsive towards issues of staff welfare especially issues bordering on staff promotion, gratuity and increase of staff emolument, amongst many others.”
He said, “Unfortunately, staff morale was at the lowest ebb under the regime of the immediate past Management.
‘It became clear to the SEC Staff Union and our parent body, the Association of Senior Civil Servants of Nigeria (ASCSN) that a vibrant capital market and a highly motivated SEC workforce could only be achieved through a change of SEC Management by Mr President.
“This prompted the Union to cry out to His Excellency, President Bola Ahmed Tinubu. By clearing out the ineffective SEC Management led by Lamido Yuguda, His Excellency, President Bola Ahmed Tinubu has lived up to his sterling reputation as a listening President.”
He said the SEC Staff Union has pledged to collaborate seamlessly with the new board under the leadership of board chairman, Mr. Mairiga Aliyu Katuka and Director General, Dr. Emomotimi Agama, to deliver a vibrant capital market in line with President Tinubu’s Renewed Hope Agenda.
However, to achieve this, he called for the commission to be exempted from the 50 per cent deductions on operating surplus as contained in the Finance Act 2024 because the Commission is a development institution.
He said, “We want this management to look into issues of staff promotion, vacancies and gratuity. We urge them to look at it very well and settle those issues as they concern staff directly.
“Also, there is need for Management to meet with the government on the issue of 50 per cent deductions on operating surplus. These deductions have almost incapacitated the Commission as the SEC has been having great difficulties carrying out its dual functions of regulating and developing the capital market.”
On the capital market, he said the Union is “urging the new management to constitute a market wide committee who will proffer solutions to the various issues currently bedevilling the market.”
E-Financial
Kenya to Extradite Anjarwalla, Binance Executive Linked to Tax Evasion to Nigeria
Kenya is preparing to extradite Nadeem Anjarwalla, a Binance executive wanted by Nigerian authorities for alleged involvement in tax evasion and a dramatic escape from custody.
Anjarwalla was apprehended in Kenya over the weekend in a joint operation involving several agencies, including the Economic and Financial Crimes Commission (EFCC), Nigeria Police Force, Kenya Police Service, FBI, and INTERPOL, following weeks of search efforts.
He is expected to be extradited to Nigeria within the week to face trial on tax evasion charges, with the possibility of additional charges related to illegal passport use and escape from custody.
Anjarwalla, Binance Africa’s regional manager, along with another executive, Tigran Gambrayan, encountered legal issues in Nigeria in February due to their association with the crypto exchange.
Anjarwalla evaded custody in March using a Kenyan passport and had been evading authorities until his recent capture.
This development adds to the ongoing tension between Binance and Nigerian authorities. Gambrayan, who has been detained since February, is currently facing trial for alleged tax evasion.
However, the proceedings have faced delays, with the court adjourning the case twice due to issues with formally serving charges to the exchange. Binance CEO Richard Teng has expressed willingness to cooperate with Nigerian authorities, but specific efforts to secure the release of the detained executives remain undisclosed.
Similarly, Gambrayan’Kenya to Extradite Binance Executive Linked to Tax Evasion to Nigeria attempts to secure bail have encountered obstacles, with a federal high court in Abuja postponing his bail application hearing.
He is presently held at the Kuje Correctional Center pending further legal proceedings.
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