E-Financial
Financial Inclusion Agents Decry Challenges with PoS, Others
As the central bank of Nigeria (CBN), drives financial inclusion with giant strides and NIBBS upgrading her system to accommodate the projected 600m point of sale (PoS) terminal transactions this year, agents at the last-mile are faced with new trends of challenges in deepening financial inclusion.
Among the new challenges according to them centre around PoS transactions, lack of accurate transaction data, unauthorized PoS chargebacks, agent deployment and viability among others.
Fasasi Sarafadeen Atanda, managing director, ECOSA Hybrid Network, who spoke to Nigeria CommunicationsWeek lamented that the new trends of challenges are inimical to realizing the objectives of achieving 80 percent financial inclusion goal by the year 2020.
On PoS resolution challenge, he said that most customer desks of commercial banks in Nigeria lack proper knowledge of PoS dispute resolution procedure.
“POS is an electronic device like ATM, and any dispute should be electronically resolved between issuing and acquiring banks. So, why should the banks toss customers around?
“Today, banks usually turn customers back by asking them to return to agents and claim their declined-debit funds. In fact, to demonstrate the seriousness of their knowledge gap, some banks will print internal arbiter conversation mail for customer to go after the agents for refund. This action has led to customer’s loss of trust in the use of PoS and agents are sometimes locked up by the police upon customer’s complaint.
“CBN needs to urgently circularize PoS dispute procedure and ensure compliance of commercial banks. For some other banks that accepted dispute complains and processed, they usually fail to follow up and close the resolution by getting customers account credited. Are there no time limits for PoS dispute resolution in Nigeria?
Atanda added that there should be at least three sources of data for PoS transactions which are NIBBS source, PTSP and the bank sources.
“Agents or merchants should ordinarily have access to at least PTSP and/or the bank data. Unfortunately today, there are serious challenges with all the above data sources. For instance Transaction Log Monitor, Olympos database from NIBBs, cannot recover previous transactions when the need arises possibly due to technical glitch.
“There are also instances where transactions of certain TIDs got missing from transaction records on the PTSP database. More so, only few banks make PoS transaction reports available to agents and merchants daily. The implication of loss or inaccurate data is reconciliation issue and merchant/agent capital erosion.
He also expressed financial inclusion agents’ frustration over unauthorized PoS chargebacks. According to him ‘most merchants and agents are closing shops today because of numerous unauthorized chargebacks . While recent upgrade by NIBBS has reduced the PoS transaction failure rates, the other determinant which is Prompt terminal upgrades by PTSPs still causes high declined rate with the accompanied daily chargebacks by the banks. Most banks abuse their power to debit bank accounts without recourse to laid down rules of notifying merchants and agents at least 72hrs ahead of debits. Also, some banks chargeback narrations do not show TIDS of the terminal being charged and most agents see this as fraudulent debits’.
Victor Olojo, National President, Association of Mobile Money Agents of Nigeria (AMMAN), noted that Interoperability has also continued to remain a major challenge for them in this industry, especially agents.
“Because, we deal with consumers who cut-across different mobile money operators and banks, for instance, if I’m an agent with bank A and I’m unable to do transactions with Bank B with the device of Bank A that is not really the idea of financial inclusion.
“Financial inclusion should enable people irrespective of whatever financial institution they are operating. It means, if I have a Paga wallet I should be able to send money from my Paga wallet to Quickteller or PocketMoney wallet. Presently, this is not happening. What we have in the market place today is using different point of sale terminals for different banks, in that regard, I ‘m using 10 PoS for 10 banks. The ideal situation should be one PoS from Bank A should be able to attend to customers from nine other banks.
Nigerian banks have resumed processing international tuition payments from Naira accounts through the Central Bank of Nigeria (CBN)’s Form A portal.
Form A is an application form designed by the Central Bank of Nigeria to pay for service transactions (invisible trade).
The form allows customers to purchase foreign exchange at the CBN or interbank rate to make payments for eligible services as predetermined by the foreign exchange manual.
This development comes a month after commercial banks announced the resumption of international transactions on their naira cards.
In an email to customers, Guaranty Trust Bank Limited (GTBank) and Lotus Bank announced that the service is now available for applicants paying undergraduate and postgraduate tuition fees abroad.
“Pay international tuition fees directly from your Naira account,” the notice from GTBank read.
To access the service, customers are required to register and submit their applications via the Trade System Portal at www.tradesystem.gov.ng.
GTBank explained: “Select the ‘Form A’ application for Educational Fees. Choose GTBank as the processing bank, attach required documents, and submit the application.”
Similarly, Lotus Bank stated, “Register on the Trade System Portal. Select Form ‘A’ application for Educational Fees. Choose Lotus Bank as the processing bank, attach required documents, and submit the application.”
In a similar notice, Lotus Bank also informed customers of processing international fees using its facility.
“Register on the Trade System Portal (www.tradesystem.gov.ng). Select Form ‘A’ application for Educational Fees. Choose Lotus Bank as the processing bank, attach required documents, and submit the application,” the bank said.
In 2022, Nigerian banks said international school fees and upkeep requests via Form A will be processed within 120 days due to forex scarcity at the time.
Safaricom, M-PESA and PayPal have announced a strategic collaboration to enable account linking and seamless fund transfers across their networks.
This collaboration aims to empower more than 35 million M-PESA customers and two million businesses and micro traders in Kenya to access PayPal’s global network.
By first linking their PayPal and M-PESA wallets, users can easily transfer funds from their PayPal accounts into their M-PESA wallets, and vice versa. This service is designed to enhance the experience for customers and businesses transacting between the two platforms.
The solution is currently available to Safaricom M-PESA customers in Kenya, with plans to roll out the service to the other M-PESA markets in the future.
“As globalization and digitization continue to reshape how people and businesses connect, our partnership with PayPal is a bold step forward in enabling seamless, worry-free, safe, secure, and inclusive digital payments.
“This collaboration empowers over thirty-five million customers and two million businesses and micro-entrepreneurs across Kenya to participate in the global digital economy by conveniently sending and receiving payments across more than 200 markets. It’s part of our commitment to unlocking opportunities and transforming lives through the power of M-PESA,” said Esther Waititu, Chief Financial Services Officer, Safaricom PLC.
“Building seamless connections between the global economy and local financial ecosystems is crucial to expanding digital financial inclusion,” said Otto Williams, Regional Head and General Manager for the Middle East and Africa, PayPal. “We are thrilled to enable millions of M-PESA’s customers across Africa connect more easily to PayPal’s international customer base.”
For 18 years, M-PESA has driven financial inclusion and bridged the digital divide. With M-PESA Kadogo, introduced in 2016, Safaricom waived fees for transactions of Kshs 100 and below, making digital payments more accessible. Now, through Ziidi MMF, customers can invest from as little as Kshs 100, promoting a culture of saving and financial wellness.
The partnership will tap into the emergence and growing popularity of the gig economy that has seen a rise among Africans accepting online jobs for clients across the world.
It equally marks a growing trend of interoperability between fintech providers with a goal of providing customers with a digital financial ecosystem that meets their needs by combining different capabilities.
PayPal is a leading global payment processor with more than 400 million active PayPal accounts operating across 200 markets, while M-PESA is Africa’s leading mobile money service connecting more than 50 million customers across Africa, 2 million businesses and micro traders, with more than $1.1 billion transacted daily.
Federal government has mandated banks and financial institutions to begin reporting monthly transactions exceeding N25 million for individuals and N100 million for firms to the tax authorities.
Under the new provisions of the Nigerian Tax Act, financial institutions are required to submit quarterly returns to the Federal Inland Revenue Service (FIRS).
The agency will be renamed to the Nigeria Revenue Service (NRS) from January 2026, when the new tax system will take effect.
“Every person who has an obligation to deduct and remit tax under this Act or any other Returns for tax legislation shall render monthly returns to the appropriate tax authority, as specified deduction of tax in the regulation issued for that purpose,” the Act reads.
“Without prejudice to section 142 of this Act, every bank, insurance company, stock-broking firm, or any other financial institution, shall prepare, with or without demand be delivered by the relevant tax authority, quarterly returns to the relevant tax authority specifying the names and addresses of new customers;Nigerian fashion trends
“…and existing customers in the case of (i) an individual, all transactions where the cumulative transactions in a month amount to N25,000,000 or more, or (ii) a body corporate, all transactions where the cumulative transactions in a month amount to N100,000,000 or more.”
Prior to the new tax law, banks were mandated to report deposits of N5 million — a measure intended to curb illicit financial flows, according to TheCable
Experts said the shift is part of efforts to tighten anti-money laundering reporting in the financial sector.
In 2023, Nigeria was listed on the grey list by the Financial Action Task Force (FATF) over deficiencies in tackling money laundering and terrorism financing.
Since then, the country has been making efforts to exit the grey list, which subjects it to increased monitoring by the FATF.
In November 2024, Hafsat Bakari, chief executive officer (CEO) of the Nigerian Financial Intelligence Unit (NFIU), said Nigeria has achieved upgrades in five key recommendations from the FATF.
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