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Cashless Transactions


Cashless Transactions Platforms, Challenges and Opportunities The Story A paper presented at the annual Conference of The Computer Professionals Registration Council ... – PowerPoint PPT presentation

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Title: Cashless Transactions

Cashless Transactions
  • Platforms, Challenges and Opportunities

The Story
A paper presented at the annual Conference of The
Computer Professionals Registration Council of
Segun Akano CEO, Upperlink Limited
How We Got Here
  • CBN introduced a cashless policy which is to
    enhance the Nigerian Payment system, reduce the
    use of cash in payments for goods/services and
    improve the use of Electronic Payment Systems.
  • The specific advantages are to reduce the heavy
    burden of Cost of Cash Management, Security of
    money and people, Money Laundering, Transaction
    Losses due to Fraud and Counterfeit among others
  • The policy attempts to place a tab on a daily
    cumulative cash lodgments withdrawal from banks
    of N150,000 N1m for individuals corporate
    customers respectively .
  • CBN recently reviewed upward the limit for free
    cash transactions for individuals to N500,000
    from N150,000 and for corporate bodies to N3
    million from N1 million
  • The policy took off in Lagos on April, 1, 2012
    and is expected to begin nationwide in Jan 2013.
  • Since its implementation, many issues have arisen
    and there have been efforts made to respond to

The Journey So far
  • Presently there are between 18 to 20 million
    different types of cards in the hands of
  • There are over 60,000 POS in use across Nigeria
    presently. CBN plans to deploy 350,000 by 2015 of
    which 90,000 will be done in 2012 alone.
  • POS Transaction grew from N100m in May 2011, it
    has now reached N2.34bn in May 2012 with over
    7000 transactions done daily (about N78m per day)
  • POS transactions are expected to grow by 200 in
    the next year Interswitch
  • Of the over 11,000 ATMS deployed nationwide,
    transactions have hit 110m monthly up from 100m
    recorded as at last year July.
  • CBN has however encouraged the banks to deploy
    additional 75,000 ATMs to beef up capacity.

Cashless (Cashlite) Regime What is involved?
Specific economic activities covered within the
context of the cashless initiative
include -Paying for services -Buying items
-Subscribing for services -Collecting from one
or more payer -Aggregating deductible funds.
Cashless (Cashlite) Regime Platforms
There are about 6 Principal Platforms
viz -Point of Sale Terminal POS -Automated
Teller Machines ATM -Web Gateways
Paydirect/Webpay -Mobile M-Money -NIPS NIBSS
Instant Payment System -Account-to-Account
Transfer NEFT, RTGS
Cashless (Cashlite) Regime Stakeholders
Cashless Transactions Stakeholders include but
not limited to 1. Merchant Acquirers Banks 2.
Card Issuers Banks 3. Merchants Stores,
Schools, Hospitals, Churches 4. Cardholders
Individuals 5. Card Schemes and Card
Associations Loyalty Schemes, 6. Switches
Interswitch, Chams, Etranzact 7. POS Terminal
Owners 8. Payments Terminal Service Aggregator
(PTSA) ITEX 9. Payments Terminal Service
Providers (PTSP) Paymaster, Etop, Citiserve,
Valucard, EasyFuel and ITEX 10. Processors
NIBSS 11. Independent System Operators (ISO)
Systemspec, Parkway, Upperlink
Cashless (Cashlite) Regime Enablers
  • Enablers are firms who on the face-value
    capabilities of the Cashless PLATFORMS build
    several solutions for organizations to manage
    outflow and inflow of Money through these
    gateways. Specific examples are
  • -Payment Suites eg. PayChoice, Remita
  • -Collection Suites BranchCollect, Remita,
    PayChoice, BankCollect
  • -Payroll Application
  • -E-Commerce Solutions
  • -E-Wallet Products
  • -

Cashless (Cashlite) Regime Challenges
  • Some are rather best described as Teething
    Problems, Others are systemic and require
    conscientious consideration
  • Poor communications network
  • Limited POS deployed
  • Interoperability of Cards on the platforms
  • Poor response time to customer complaints
  • User apathy
  • Vulnerability to fraud
  • Insufficient sensitization

Cashless (Cashlite) Regime The Gaps
  1. In the face of all these Nigeria still lags
    behind many nations in the use of ATMs and PoS
  2. ATM per individual is very low in Nigeria and
    calls for immediate actions as shown

Country ATM/100 people
United States 169
South African 55
Nigeria 12
  1. 80 of the cash in Nigerias economy is still
    locked up in the hands of the economic
    participants in the informal sector.

Cashless (Cashlite) Regime Opportunities
  1. It is estimated that cashless transactions in
    Nigeria is expected to grow at an annual rate of
    85 in the next 5 years.
  2. Forecast has it that overall transaction
    processing for banks and other financial services
    would surpass 15bn (N2.4trn) by the end of 2012.
  3. Many more levels are expected to be created in
    the E- Business Value Chain that will open up our
  4. It is hoped that, if the immediate challenges are
    adressed, the objectives of CBN would have been
    met on the one hand and Nigeria will be on her
    way to be among the top 20 economies in the world
    by 2020 as envisioned by the present political

Thank you
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