NEFT, NIP Transactions Hit 40Bn Daily

Daily transactions on Nigerian Electronic Fund Transfer (NEFT) and Nigerian Inter Bank Settlement System Instant Payment (NIP) have hit a record N40 billion meaning that the Central Bank of Nigeria (CBN) cashless policy initiative has gained momentum.

NEFT  and NIP are products used by corporate organizations to make payment for huge transactions electronically, in line with the cashless policy.

Data gathered from NIBSS also shows that as a result of the cashless policy, cheques, Point of Sale (PoS) and Automated Teller Machines (ATM) usage have continued to record huge volume and value.

Buoyed by the success of the pilot scheme of the cashless policy in Lagos, the CBN plans to extend the policy to FCT, Rivers, Kano, Abia from July 1.

The policy was initially envisioned to begin across the country in January 2013.

According to Chidi Umeano, head, Shared Services at the CBN, the cashless project has continued to record huge success, as stakeholders continue to tackle the initial challenges associated with the alternative channels.

Umeano said “banks have continued to roll out more innovative electronic payment platforms to meet customers’ expectations. The cashless policy has been very successful in Lagos considering when we started and how far we have gone in terms of PoS deployment.

“When we started the cashless Lagos, we had less than 10,000 PoS in Lagos, but currently we have over 150,000 PoS machines in the state alone.”

It would be recalled Tunde Lemo, CBN deputy governor Operations, had explained: “When we talk about nationwide roll-out, we are also being careful to ensure that we make use of resources in a smart way. Cash doesn’t flow in the same volume in every state of the federation. What we would do in July is to look at those other market clusters where large of volumes are transacted and add them to Lagos.

“It is cheaper that way because the resources you need to cover the entire 923 square kilometres in Nigeria are huge. But you can achieve almost the same thing by looking at the pattern of cash distribution and you can cover about 90 per cent of that by adding about five more locations to Lagos. That is: Abuja, Kano, Aba, Port Harcourt and Onitsha”Some of the benefits of the cashless policy include; increased convenience for the customers as there are more service options; reduced risk of cash-related crimes; cheaper access to (out-of-branch) banking services and access to credit.

For corporations, it is faster access to capital as well as; reduced revenue leakage; and reduced cash handling costs.

For the government: it is increased tax collections; greater financial inclusion; increased economic development.