Mobile Money Operations: Why CBN Opted for Banks, Not Telcos

23 Feb 2012

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Sanusi Lamido Sanusi

By Emma Okonji

Facts have emerged as to why the Central Bank of Nigeria (CBN), preferred to register banks, instead of telecommunications operators (Telcos), for the operation of mobile money scheme in the country.

CBN had last year, registered banks and other financial institutions to operate mobile money, leaving out the telecommunications operators, that supposedly have the largest customer base of over 90 million subscribers, compared to the 20 million bank accounts in the country.

CBN director, Mr. George Shamsa who dropped the hint at the 66th Telecoms Consumer Parliament (TCP) held in Lagos at the weekend, said CBN was aware of the huge potentials of telecommunication operators in driving mobile money, but opted to licence banks and other financial institutions to avoid clash of interest between banks and telecommunications operators.

He said the CBN research revealed that although telecoms operators have more subscribers and wider network area for the penetration of mobile money, the banks have the financial strength to drive the process much better, adding that the apex bank came to the conclusion that telecommunications operators could partner with licensed banks and other financial and non-financial institutions in driving the scheme, since they have the platform on which mobile money transactions will thrive.    

Executive Commissioner of the Nigerian Communications Commission (NCC) in charge of Stakeholders’ Management, Mr. Okey Itanyi, assured telecoms subscribers of maximum protection, even when telecoms operators were not directly involved in driving the mobile money scheme.

“NCC will rely on forum like the TCP to protect consumers’ interests and ensure integrity and reliability in all financial transactions, using the mobile phone,” Itanyi said, adding that NCC is interested in seamless interconnection between network operators, to make the mobile money scheme a huge success.

CBN, last year, concluded all arrangements on its cash policy initiative, by licensing 11 mobile money operators to commence a pilot scheme on cash-lite, beginning with Lagos, the commercial nerve of Nigeria.

The cash-lite initiative is to help drive usage of alternative electronic products and channels for financial transactions. According to CBN, “the electronic channels and products are secure, convenient, fast and reliable and do not have the short comings of cash such as bulkiness, slow transaction speed, cost of handling cash and risk of carrying cash.”

Highlights of CBN’s policy on cash-lite, include the implementation of the policy on cash-lite in Lagos from January 1st 2012. Only licensed Cash-in-Transit (CIT) companies shall be allowed to provide cash pick-up services. Banks will cease cash in transit lodgement services rendered to merchant-customers in Lagos from December 31st 2011.

Third 3rd party cheques above N150, 000 shall not be eligible for encashment over the counter. Any cheque issued with a value above N150,000 to a third party can only be deposited into an account as such cheques cannot be cashed.

Commencing from March 30, 2012, a daily cumulative limit of N150,000 and N1,000,000 on free cash withdrawals and lodgements by individual and corporate customers respectively shall be imposed. To this end, individuals and corporate organisations that make cash transactions above the limits will be charged a processing fee of N100/thousand and N200/thousand respectively for amounts above the cumulative limits.

Tags: Business, Nigeria, Featured, Mobile Money Operations, CBN, Banks, Telcos

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  • Can somebody ask the President to sack this Sanusi. He is a wolf in sheep clothing and takes too much reckless decision on his own. How can you give license 20 million customer-base than more that 100 million customer-base in the telecom industry. He left victims of violent attacks in the country and promptly donated 100 million to his home-state Kano. To further confuse us, he ditch out 20 million to Madalla. Why didn't he show all these gestures when other northern and central parts are experience hard violence? Sanusi must be sacked for politicizing his position

    From: Emmanuel

    Posted: 3 years ago

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