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CBN, banks should upgrade digital infrastructure for seamless e-transactions –Experts

*Information and Communications Technology professionals  caution the Central Bank of Nigeria and commercial banks against a repeat of the hardships, socio-economic dislocations Nigerian consumers witnessed nationwide early 2023 by strengthening the digital ecosystem

Gbenga Kayode | ConsumerConnect

As Nigeria prepares for December 31, 2023, deadline for transition to full use of re-designed Naira notes, Information and Communications Technology (ICT) stakeholders have urged the Federal Government to expand the West African country’s digital infrastructure.

ConsumerConnect learnt the expert opined that robust deployment of ICT infrastructure is central to the successful implementation of the Central Bank of Nigeria (CBN) cashless policy.

The ICT professionals as well cautioned the authorities and the players in the financial industry to be proactive on the e-payments ecosystem, agency report said.

They also warned that the chaos and attendant hardships and social dislocations witnessed nationwide, including in the banking sector, would repeat itself if urgent steps are not taken to expand the ICT infrastructure in the country.

Implementation of cashless policy in economy

It is recalled that President Muhammadu Buhari, in his nationwide broadcast February this year had directed that the N200, N500 and N1,000 should cease to be a legal tender in Nigeria by April 10.

However, consumers of financial products and services, legal experts, civil society groups, and leaders of thought in the Nigerian Federation had opposed the application of Buhari’s directive.

Later, a group of state governors, including those of Kaduna, Kogi and Zamfara challenged the President’s directive in the court.

Subsequently, the Supreme Court of Nigeria in a March 3 ruling extended the validity of the old banknotes deadline to December 31 this year.

CBN, commercial banks should address issues of delayed, failed transactions

Meanwhile, some Nigerians, who spoke on the importance of robust ICT infrastructure, urged the Federal Government and commercial banks to expand the country’s ICT infrastructure for the effective implementation of the ongoing cashless policy.

Dr. Okwara Udensi, Chairman, Manufacturers Association of Nigeria (MAN), Edo/Delta Branch, said the cashless policy would be effective, if the electronic payment system is made to function effectively in the economy.

Udensi stated: “People have lost confidence in the cashless policy because of the issues of delayed and failed transactions.

“E-channels should be made effective. We are almost getting there because micro businesses are now adopting cashless means of transactions, but the e-channel of payment is not effective.”

The MAN Chief also noted: “Banks should also reverse failed transactions instead of waiting for customers to go and lay complaints at their offices.”

Mr. Ibrahim Ode, an ICT consultant, also told NAN in Lafia, Nasarawa State capital, that with right Internet infrastructure, Nigeria would join the comity of nations where key social services, not just banking, have been digitalised.

The expert said: “We all need to support it since everybody is using handsets, smart phone, in every smartphone there is integration of Internet service.

“The whole world is looking at having the system that is fully digitalised and digitalisation will result in cashless services.”

Speaking on the issue also, Mrs. Rhone Peters, Coordinator of Edo Export Cluster, said Micro, Small and Medium Enterprises (MSMEs) are gradually subscribing to the policy.

Mrs. Peters the Deposit Money Banks (DMBs) to upgrade their Internet facilities to ensure a seamless transition to the cashless regime in the Nigerian economy.

In his view, Mr. Mustapha Kabara, a lecturer in the Department of Economics and Development Studies, Federal University, Kashere, in Gombe State, noted that lack of ICT infrastructure was a major threat to effective implementation of the  policy.

Kabara stated: “ICT infrastructure is a key component that cannot be undermined because the issue of Automated Teller Machines (ATMs), Internet Banking and Point of Sale (PoS) are all ICT-related.

“If ICT infrastructure is not functioning well other components of the cashless policy will not work.”

The don also said: “The ICT industry is not mature yet.

“The service providers are still learning and there is room for improvement going forward just as obtained in developed economies.

“The service providers and drivers of the cashless policy should improve the system before people start losing confidence in the entire system.”

In the same vein, Isa Uzairu, a Dutse-based ICT expert, urged the fede6ral Government to ensure the provision of strong, stable and fast Internet facility to fast-track implementation of the cashless policy.

Uzairu opined “fundamentally, ICT has to do with message, source, medium, protocol and receiver.

“So, in banking system, ICT applies to when one deposits money (sender), bank (medium) and third party (receiver).”

He affirmed that “ICT has a vital role to play in cashless policy.

“Cashless policy is for all countries, not just Nigeria. All developed countries use this cashless policy.”

According to him, with good Internet facilities, ICT will enhance the fortunes of Nigeria’s banking sector.

Ibrahim Bashir, also an ICT professional, urged the CBN to compel commercial banks to subscribe directly to satellite companies for effective customer service delivery.

Bashir also urged commercial banks to decentralise the operations of their IT units.

The expert noted this would address problems associated with delayed and failed e-transactions.

He further explained: “By doing so, the banks will address problems as they occur at the branch level as against the current practice of referring such malfunctions to their headquarters.”

In his comment, Abdullahi Muhammad, another ICT expert advised the Nigerian banks and mobile telecommunications companies to improve on their IT capacity to ease off challenges consumers are facing on e-transactions.

The professional said it was unfortunate that Nigerians were going through difficult times as the cashless policy was being implemented.

He stated: “When there is pressure right from the Internet service provider, there will be an overload, leading to poor network and a crash.

“For the banks to successfully implement a cashless economy, the Nigerian government must invest heavily in the provision of stable power and telecommunication infrastructure.”

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