Wednesday, April 23, 2014

Unreliable infrastructure, fear of fraud slow down Central Bank’s cashless policy

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The cash-less policy has numerous challenges.

Persisting challenges exemplified by unreliable infrastructure and fear of fraud would halt the progress of the cash-less policy if not adequately addressed, experts have said.

The Vice President/Group Head, e-business and card services of Keystone Bank, Uchenna Okwodu, urged bankers to go back to the drawing board to seek a way out of the challenges.

“The single reason why Point of Sale, PoS, is not effective in Nigeria is infrastructure. The major challenge that we are facing in my bank, and I am sure every other bank, is unstable infrastructure, that is the reason why surveys and analysis have shown that PoS is at its lowest ebb.

“If we don’t get the Infrastructure right, the PoS would die a natural death” she said, at the cash-less policy conference organised by the Lagos Chamber of Commerce and Industry, LCCI, held on Wednesday, in Lagos.

“What we banks are doing, together with the Nigerian Interbank Settlement System (NIBSS) is to put a proper infrastructure in place, GPRS. Last week, our mobile phones were not connecting, so until that infrastructure is tested and tried, then we would be able to employ it,” she added.

She, however, said that despite the challenges, the cash-less society is growing.

“The Central Bank is working on mobile money, and is possibly enlisting post offices as agents. With this, mobile money would come to stay,” she said.

Mobile money, Ms Okwodu said, is the next best thing that would help improve the progress of the cash-less policy. She suggested that NIBSS and the Central Bank should call the telecommunication companies together.

The bank chief said that another threat to the cash – less policy is societal resistance.

“We have not done enough awareness. There is need for public education. We need to do this awareness in a lot of languages. Nigeria is a cash-based economy. Going Cash-less is not going to be easy. It is going to be very gradual,” she said.

Challenges of Cash-less policy

A lot of challenges have bedeviled the Central Bank‘ policy.

Surveys by the LCCI reveal that customers would rather not go cash-less because of the lack of quality, high service charges, unreliable network, machine breakdowns, security of data and frustrations due to delayed remittances.

The Central Bank has, however, stated that it is ready to re-strategise as the challenges mount.

The Deputy Governor of the Bank, Tunde Lemo, said the regulatory body was enlightened by the fora and will upgrade its strategy.

“Awareness campaign is key, because of the feedback we get…and the appraisal we are doing and the test strategies that we have adopted in Lagos, our campaign strategy would change,” he said.

He said the Central Bank will work with the National Orientation Agency, NOA, adding that it will employ the use of drama, done in various dialects, to enhance awareness.

Mr. Lemo also said that the Central Bank has set up an e-payment fraud forum that meets monthly.

He said the regulatory body also has a consumer protection department that would address consumer rights. He added that the Central Bank would introduce incentives for merchants and other parties needed for the success of the policy.

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