OUR BLOG POST
A credit card designed by the Central Bank of Nigeria (CBN) for domestic use has been scheduled for deployment, it was learnt yesterday.
The card is expected to compete with other debit cards, including Mastercard, Discovery and Visa cards.
Following its introduction, local banks and other financial institutions will be in a position to offer payment solutions like debit, credit, virtual, loyalty and tokenised cards, non-interest card, identity card.
The CBN said it introduced the National Domestic Card because of its belief that Nigeria has achieved “significant transformation in its payments system over the past decade.
The apex bank added that this has been driven by rapid digital and technological innovation, increasing mobile penetration and the proactive policy initiatives of the CBN which have spurred unprecedented adoption of digital financial services.”
It listed the benefits of the card scheme to include among others
Given that MasterCard, Visa, Discovery and other such cards are foreign controlled, the bank said National Domestic Card would ensure “improved sovereignty and security of our data and its operations will be locally based. It will also help to improve and drive financial inclusion nationwide”.
The card also has the potential to leverage its platform “for seamless dissemination of government-to-person payments and other social impact initiatives, ultimately enhancing financial inclusion and supporting the growth of a robust digital economy”.
The card will be delivered through Nigeria’s central switch, the Nigeria Inter-Bank Settlement Systems (NIBSS) Plc, in conjunction with the Bankers Committee and other financial ecosystem stakeholders.
Today’s deployment will enlist Nigeria into the growing list of countries like India, Turkey, China, and Brazil that have launched similar cards for domestic use.
The countries have harnessed the transformative benefits of the schemes to drive their payments and financial systems, particularly for the underbanked.
The CBN said: “The domestic card scheme will be an important game changer for financial inclusion in Nigeria.
“The plan is to deliver Africa’s first central bank-driven, domestic card scheme that combines a fully domestic infrastructure with international interoperability.
“Our plans will enable us to pivot into the largest card scheme in Africa, and amongst the biggest globally.”
It could not be ascertained yet if Nigerians would be able to use for international transactions as its application is for now restricted to our local shores.
At the Bankers’ Committee meeting where the decision to introduce the card was taken, NIBSS Managing Director, Premier Oiwoh said the scheme is “being deployed to help improve the payment landscape across the ecosystem in Nigeria.
He said: “This card will be configured to address the unique ecosystem issues that we have to help improve payment system issues that we have across the nation.”
“We also expect the card to provide affordable pricing, adding that the charges will certainly be lower because it is expected to be charged for in Naira as against foreign currency.
“NIBSS is a sharing infrastructure and the card central management system will be shared and each integrating entity will integrate via APR platform and we expect that other value addition will be mined and created around this scheme.”
Oiwoh added: “It will support micro payment and credit, e-government identity management, transportation, health sector and agriculture in terms of payment”.
Essentially, the card will reduce the dependence on cash along the landscape and help promote the cashless initiative driven by the bank.
Oiwoh added that the operational effectiveness of this card “is expected to be robust, and it should drive a lot of innovation, standardisation, and full end-to-end visibility to improve fraud management and better dispute resolution process around the card operating system”.
First Publised on The Nation
Also Publised on: