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SBH Raises Alarm over Non-Remittance N20trillion Deducted as Stamp Duty

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Stamp Duty charges on bank transactions believed to have yielded N20trillion have developed wings and School of Banking Honours (SBH) has raised alarm, according to Nation.

Federal government through the Central Bank of Nigeria (CBN) on January 19 directed that N50 stamp duty be made on all transactions including bank electronic transactions above N1000.

The policy is aimed at boosting the country’s revenue base through non-oil sectors such as taxes and rates.

But the fortune raked in, has pitched the Nigerian Interbank Settlement System (NIBSS) against the School of Banking Honours, an institution registered by the Nigerian Copyright Commission (NCC).

The SBH is spearheading the recovery and remittance of the funds into the Federation Account for sharing by the Federal Government and the 36 states.

Tola Adekoya, SBH’s Project Consultant/Acting Rector, said based on findings from the research arm of SBH, he raised a Demand Notice dated 10th March, 2015, entitled, “Stamp Duty On Electronic Transfer Receipts (2013-2014)” on NIBSS for N7.719trillion as accruing and unremitted revenue to the Federal Government and the states.

He was invited by NIBSS for a discussion, but Adekoya is yet to honour the invitation.

“That invitation is traceable to the Demand Notice of 10th March 2015 that SBH raised on NIBSS as Stamp Duty of N7.7 Trillion due to 36 states and the Federal Government on electronic cash-less transfers which turned over an aggregate N160 Billion daily in just five states of the federation in early 2013, as reported by Central Bank Nigeria (CBN),” Adekoya said.

He told The Nation that from all indications, that figure may have risen close to N20trillion.

He said: ”Further reports revealed that the Stamp Duty revenue has now increased to N20trillion (in local banks), or $53.3 billion (in foreign banks) in four years to 31st March, 2017, and out of which less than one per cent was later swept into a dedicated account with Central Bank of Nigeria, in 2016.”

To him, the matter of diverted public fund should be of serious concern to the public in view of the amount that is in contention and the involvement of agencies and persons allegedly denying governments of such huge revenue collected from the unsuspecting banking public and for appropriate disciplinary action to be taken.

By its Memorandum of Association, the SBH is approved to research into banking operations, and collaborate with banks and government on banking matters. It is empowered to represent government in the suit under its Copyright Certificate No. LW1023 dated 27th September 2012, and titled, “50-Naira Stamp Duty for Government on Electronic Cashless Transfers and Manual Bank Teller Deposits”.

Adekoya said the alleged diversion of public funds should be of serious concern to the public in view of the amounts involved, and the culpability of agencies and persons that have been denying government of such huge revenue collected from unsuspecting banking public, for appropriate disciplinary action.

He said the SBH had approached the CBN in 2012 to partner on the research outcomes that would absorb retrenched and ex-bankers to lead its young emerging bankers on practical part-time banking jobs at a lower career level that is branded as “Shadow-Banking”.

“SBH clarified that Shadow-Banking products would birth other Shadow Industries to absorb the youth in high volume, until vacancies exist in their target career sectors, and for which they could be employed,” Adekoya said, adding that the SBH offer was turned down by the CBN, hence the body later aligned its job creation activities with CBN’s Financial System Strategy (FSS) 2020, but the CBN did not complement this, either, he stated.

Undeterred, Adekoya said, “the Institute then proceeded with a proposal to Nigerian Postal Services (NIPOST) on 20th April 2012 to increase its internal revenue by exploring a narrow window provided for affixing adhesive stamp on banking receipts in Stamp Duties Act 2004, and a Master Services Agreement was signed by both parties on 14th September 2012”.

“The institute then reverted to CBN on its first research work by a letter dated 27th September 2012, titled, “Revenue Collection for Government through Banks”, requesting for approval to engage banks and other financial institutions as collecting agents on the stamping and remittance of Stamp Duty on manual and electronic transfer receipts from N1,000 ( inclusive of all those from below N500,000 that CBN had earlier set as limit for banks) into government coffers,” the report said.

The SBH got approval letters from the CBN. Its two defined roles were firstly to affix N50 stamp as evidence of Stamp Duty Paid on bank receipts, as covered by the Master Services Agreement with NIPOST, and secondly to sweep Stamp Duty Revenue to government, as duly covered by the Copyright Certificate No. LW1023.

Based on the CBN approvals, the institute secured written commitments from three banks to lead other banks on manual stamp duty collection for government.

Adekoya said  since “NIBSS needed no such circular on electronic stamp duty collection for the government, because it runs a central operation, it joined the institute at a press conference on 4th January 2013 to support the government’s revenue project, and was engaged as the ‘official sweeping agent’ for government on 7th January 2013.”

He said the government directed that the only thing we should not charge stamp duty on is naira currency. “We went to Nigeria Interbank Settlement System (NIBSS), which is the firm maintaining the portal for cash-less policy for all the banks. By January 2013, we were ready to run it. Since 1993, NIBSS has not remitted any stamp duty to the government,” Adekoya, said.

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E-Financial

EcoBank Research: Digital Innovation in SSA Driven by Explosion in Mobile Phone Usage

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By peter oluka

Digital innovation in Sub-Saharan Africa is being driven by the explosion in mobile phone usage, enabling African consumers to leapfrog existing business models and technologies

The 2017 version of Ecobank Research’s Fixed Income, Currency and Commodities (FICC) Guidebook, which provides expert knowledge and analysis on African markets for investors and businesses, was launched today at AfricaFICC.

Indicating a positive outlook for the continent, three key trends are forecast to take hold during the next 12 months.

The first indicates an economic rebound in sub-Saharan Africa driven by a recovery in the region’s economic heavyweights, Nigeria and South Africa, and ongoing growth in the top performers, Ethiopia, Côte d’Ivoire and (more recently) Ghana.

Growth will be driven by a rise in oil production (notably in Ghana, Republic of Congo, Nigeria and Angola), strengthening infrastructure investment across West and East Africa, and improved weather conditions which bode well for crops.

Strengthening economic activity, plus a moderate improvement in oil and mineral prices, will help narrow the current account deficit, but pressure on SSA currencies will remain.

The second emerging trend points to West Africa’s gas sector becoming a hive of activity in 2018 from Senegal to Angola, with the development of gas pipelines, floating liquefied natural gas (FLNG) platforms and major gas field projects.

Governments in the Gulf of Guinea and across West Africa have ramped up efforts to secure gas supply in order to boost domestic power generation and diversify their revenues away from crude oil.

Deregulating the gas market and allowing market-driven gas prices will be key to unlocking further gas infrastructure investment across the region.

The third trend suggests Fintech innovation in Africa picking up speed in 2018 buoyed by a new generation of Africans who are ‘digital natives’. The proliferation of tech hubs across Africa (notably in South Africa, Kenya, Rwanda, Nigeria, Ghana and Côte d’Ivoire) will nurture the next wave of African start-ups and help connect them with investors.

Digital innovation in SSA is being driven by the explosion in mobile phone usage, enabling African consumers to leapfrog existing business models and technologies.

African Fintech firms are increasingly driving this innovation, deploying digital tools to build credit profiles for the previously ‘unbankable’, providing electricity to rural households that were previously off the grid, even using artificial intelligence to diagnose health problems remotely.

Edward George, Head of Ecobank Group Research, said: “The digital world moves apace, and so must we. The AfricaFICC website is a key way that we can deliver our regional market analysis and expert local knowledge of 41 African markets – which is often hard to access – to a much wider audience. We think these three trends are strong evidence that Africa has weathered the storms of late and is very much on track for improved growth in 2018.”

The Ecobank Research Centre is dedicated to providing the highest quality research for clients to help them navigate the complex African marketplace

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Court Modifies Orders Freezing Accounts without BVN

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A Federal High Court in Abuja Wednesday modified the order it made on October 17 this year for interim freezing of bank accounts who owners have not registered for the Bank Verification Number (BVN)

 

The court, which had stayed further operation of such accounts pending the determination of a case pending before it, has now said the accounts could be operated once the owner registers for BVN.

 

Justice Nnamdi Dimgba announced the modification Wednesday after parties in the case agreed that as presently couched, the order creates an awkward and unfortunate result such that even when account owners have got their BVN, they still will not be able to operate the accounts because doing so will be in violation of the order of court.

 

Parties in the case also agreed that the said Relief No 4 should be revised to eliminate this problem, in the interim.

 

In a ruling, Justice Dimgba said: “Having listened to all counsel on record, and with the consent of all parties represented, I hereby revise Relief No 4 of the court’s order of 17/10/17 such that the new Relief No 4 shall be:

 

“AN INTERIM ORDER of the Honourable Court stopping all outward payments, operations or outward transactions (including any bill of exchange) in respect of the accounts pending the linking of the accounts to a Bank Verification Number”.

 

In view of the above agreed compromise revision of Relief No 4, I also hereby revoke and set aside Relief No 5 of the Court’s Order of 17/10/17, which provides for:

 

“AN INTERIM ORDER of forfeiture of the monies in the said accounts without BVN to the Claimants/Applicants being accounts with insufficient Know Your Customer (KYC) guidelines contrary to Section 3 of the Money Laundering Act, 2011 and CBN guidelines the determination of the Originating Motion on Notice,” the judge said.

 

As as yesterday, none of the 19 commercial banks listed as defendants in the suit complied with the court’s order that they provide information about accounts without BVN in their custody.

 

They only filed a motion challenging the court’s jurisdiction.

 

Earlier in the proceedings, lawyer to 18 of the 20 banks listed as defendants in the suit, A. A. Adegbonmire (SAN) said his clients have filed an application, challenging the court’s jurisdiction to have made the order of October 17.

 

He said the plaintiffs served him with their response yesterday, which he needed time to react to.

 

Adegbonmire urged the court for an adjournment, which was not objected to by Joseph Tobi (for the plaintiffs).

 

The judge consequently adjourned further proceedings to December 11.

 

The Federal Government and the Attorney General of the Federation had filed the suit, querying among others, the continuous retention of accounts without BVN by banks.

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Path Solutions Emerged ‘Best Islamic Technology Provider’ @ IFN Awards 2017

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Path Solutions, a leader in banking software systems with a strong focus on the Islamic banking sector, has won the ‘Best Islamic Technology Provider’ award at the 2017 Islamic Finance news Awards. The company is winning the award for the tenth successive year and eleventh time in total.

Instituted by REDmoney – a leading global provider of specialized Islamic financial media services across three core divisions of publishing, events and training, IFN Awards is one of the most prestigious awards and highly recognized by the global Islamic finance community.

The IFN Polls was established in 2005, and continue to be an apt representation of the current Islamic financial landscape.

Speaking on the award, Mohammed Kateeb, Group Chairman & CEO, Path Solutions, said: “It’s an absolute privilege to be voted as ‘Best Islamic Technology Provider’ one more time at the IFN Service Providers Poll 2017. We especially thank our clients and partners for their continued trust and support.

They’ve made an informed choice in adopting our state-of-the-art Islamic core banking system that will enable them to add further value to complying with industry regulations, improving their management processes and service delivery.

We are again at a pivot point where new technologies are creating new paradigms that will change the shape and face of our industry along with opening up new vistas for the global financial world”.

Kateeb then added, “Path Solutions provides the power of digital transformation, enabling the unbanked to access financial services, improve their lives and secure a better future for them. Our strategy toward 2018 is driven by the ambition to become our clients’ trusted partner in digital life, creating long-term value for them.

We will allow them to be ahead of the curve by implementing a digital-first strategy, leveraging new technologies such as big data, advanced analytics, a 360-degree view of the customer and a personalized engagement, thus providing instant fulfillment to their customers.

In today’s increasingly digital world, failing to invest in and prioritize technology will come at a cost. We believe it’s time to move into the future”.

The prestigious IFN Awards are based solely on merit, and highlight key players, individuals and innovative firms who have provided the Islamic financial world with ground-breaking initiatives.

The award underscores Path Solutions’ momentum to maintaining a leadership position for more than two decades in the evolving Islamic financial marketplace, and the company’s critical role in pioneering industry-specific software solutions and services that are required for its sustainable growth.

“Announcing the IFN Service Providers Poll nominees is always exciting. The special awards honor and celebrate the outstanding annual contributions of those who are the backbone of the Islamic finance community”, commented Lauren McAughtry, Group Managing Editor, REDmoney Group.

“Path Solutions’ leadership and business model promote continuous innovation and impactful growth. Their hard work and commitment is vital to ensuring a technologically-standardized Islamic finance industry”, she said.

In a turbulent year that had its ups and downs — from the geopolitical tensions in the GCC and the ongoing effects of the US elections to giant debut sovereign issuances and oil prices bouncing back — the Islamic finance industry has sailed through successfully.

The IFN Awards recognize and reward the wide range of essential building blocks behind the scenes working to support the Islamic finance industry as it grows ever upwards. This year’s survey has seen a substantial swing with the received votes representing a rock solid review of the real state of the industry and the views of its participants.

The recipients of the IFN Service Providers Poll 2017 will be presented with their awards at a dinner ceremony held alongside the inaugural IFN Global Leaders Forum on 11th March 2018 in Dubai, and the Asian dinner ceremony on 19th March 2018 in Kuala Lumpur.

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