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Telecom firms unlikely to lead cash-less initiative — Experts

By BusinessNews Staff on October 25, 2013

Telecommunications companies are not likely to play the lead role in the country’s cash-less policy framework as is the case in some African markets, according to experts in the electronic payment space.

This, however, may not augur well for the telecoms companies, which have been clamouring for a lead role in the initiative.

Our correspondent gathered from stakeholders that there was the fear that allowing the telecoms firms to lead the process would result in the influx of many people into the scheme, which could lead to systemic problems.

Due to the fact that the Central Bank of Nigeria wants to strengthen the regulation of the sub-sector, it is also being argued that allowing the telcos to lead the process may dilute the set model.

But the telcos have continued to cite the Kenyan model, where M-Pesa, a mobile phone-based money transfer system operated by Safaricom, has revolutionised the e-Payment process.

Some core stakeholders in the cash-less ecosystem, our correspondent gathered, were nursing the fear of being unable to control the telcos if they were eventually allowed to drive the process, arguing that the Nigerian economy was too fragile for a telecoms industry-led cash-less initiative.

Commenting on the development, the Chief Executive Officer, Electronic Payment Providers Association of Nigeria, Mrs. Onajite Regha, said the telcos had been involved in the cash-less policy from the outset, but added that the bone of contention now was their fresh campaign to lead the process.

She said the telcos had not been trained to manage funds and that delicate financial issues like the cash-less policy should be left to core finance experts.

Regha added, “Even for the Deposit Money Banks, the CBN is taking off responsibilities that are not core banking from them.

“If we decide to allow the telcos to lead, a lot of people will come in at once. If then there is a systemic problem, who will all these people run to?”

The EPPAN CEO said the country was still trying to get it right in the area of core telecoms services, and that adding the cash-less policy to the current challenge would only aggravate the issue.

According to her, to facilitate penetration, stakeholders are looking at leveraging the potential of the Nigerian Postal Service to build a wider and reliable agency network.

Regha said a lot of training was also going on, even as EPPAN and other stakeholders were looking at enrolling more agents to spread the cash-less agenda and also help more people to come on board.

[Punch]

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