CBN floats national card scheme next month, targets 42 million unbanked

THE Central Bank of Nigeria (CBN) has concluded plans to float a national card scheme to enhance the payment system in Nigeria.

The CBN is partnering with the Nigeria Inter-Bank Settlement System (NIBSS) Plc and the Bankers Committee on the scheme.

CBN’s spokesman, Osita Nwanisobi, said the move was meant to promote inclusion and growth in the financial services sector via Nigeria’s central switch system, NIBSS, which provides an avenue to capture 42 million unbanked Nigerians.


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Nwanisobi said, “The CBN recognises the significant benefits from delivering Africa’s first central bank-driven domestic card scheme, which, when delivered at scale, has the potential to become the largest in Africa, and one of the largest in the world.”

The Managing Director, NIBSS, Premier Owoh, had hinted at the last Banker’s Committee meeting in October that a national domestic card would be designed to help accelerate acceptance and efficiency, and reduce operating costs of cards in the country.

Owoh explained the card would be configured to manage the payment ecosystem and improve payment across Nigeria.

“The card will provide affordable pricing. Charges on the card will be lower because it will be charged in Naira and not in foreign currency,” he had said.

He explained that the card would be optimised for local content solely for the Nigerian market and support micropayment and credit, e-government, identity management, transportation, health and agriculture, regarding payment.

The NIBSS chief expected the scheme to reduce reliance on cash across the landscape, and promote the CBN’s cashless policy.

The card will have components like debit cards, credit cards and non-interest cards.






     

     

    The ICIR reports that more than 42 million Nigerian adults live in rural areas that lack basic banking services. According to a 2021 EFInA study on trends in access to financial services in Nigeria, there are numerous gaps to fill in the rural areas populated by unbanked people excluded from the financial ecosystem.

    The EFInA report shows that while 71 per cent of urban adults have bank accounts, only 40 per cent of those in rural areas have a formal account. In over 60 per cent of rural communities across Nigeria, there are no bank branches, agents or automated teller machines.

    With the planned introduction of the card, Nigeria will be joining a growing list of countries like India, Turkey, China, and Brazil that had launched domestic card schemes and harnessed the transformative benefits for their respective payments and financial systems, particularly for the underbanked.

    An industry fraud report by NIBSS detailed that in a nine-month period, fraudsters attempted attacks 46,126 times, and were successful on 41,979 occasions, representing a 91 per cent successful rate, and amounting to a N5.2 billion loss to bank customers.

     

    Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.

    Join the ICIR WhatsApp channel for in-depth reports on the economy, politics and governance, and investigative reports.

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