Unilever Overseas Holdings acquires N352 million worth of shares of Nigerian subsidiary
Elon Musk to offer $100 million prize for best carbon capture technology
WHO warns Africa in danger of being left behind in Covid-19 vaccination
Unilever sets out plans to help build a more equitable and inclusive society
FG gives reasons for sale of government assets to fund 2021 budget
Bitcoin posts biggest daily drop since market crash of March 2020
Nigeria records $4.3 billion in Corporate Deals in 2020
FG says Excess Crude Account balance now stands at $72.4 million
CBN has disbursed N14.35 billion to DisCos for meter procurement – FG
Naira gains marginally at NAFEX window, exchange rate to remain stable
Financial Services
CBN revokes licenses of 7 Payment Service Providers
CBN has revoked the licenses of 7 payment service providers and 1 switch service provider.
The Central Bank of Nigeria has revoked the licenses of seven (7) payment service providers and one (1) switch service provider due to their inability to meet up with their statutory obligations and conditions, wherein they were formed.
This is according to an Official Gazette of the Federal Republic of Nigeria, seen by Nairametrics.
READ: Violation of payment system rules: CBN vows to sanction erring financial institutions
Although the statutory obligations that the affected firms failed to fulfil were not mentioned, Nairametrics, however, understands that the recent revocation might be connected to CBN’s renewed drive to strengthen and ensure a credible payment system in Nigeria amidst the new wave of Fintechs in the country offering varying but often nuanced services.
Recall that Nairametrics had earlier reported that CBN had approved new license categorizations for the Nigerian payment system.
Checks into the latest disclosure by the apex bank revealed that the affected institutions will for a period of six months consecutively, cease to carry on in Nigeria, the type of business for which their licenses were granted.
READ: Anchor Borrowers Programme: CBN flags off input distribution to rice farmers and loan recovery
What you should know
From the Gazette, Nairametrics gathered that the affected institutions are categorized into 2 schedules, with the first comprising of the 7 PSPs whose licenses were revoked, while the other comprised of a PSP whose Switch license was revoked.
- The 7 affected payment service providers (PSPs) whose licenses were revoked as contained in Schedule I are; Easifuel Limited, Transaction Processing System (TPS), Grand Towers Limited, Paymaster Limited, E-Revenue Gateway Limited, Eartholeum Network Limited and Globasure Limited.
- As contained in Schedule II, the sole payment service provider whose switch license was revoked is; 3Line Card Management Limited
- It is also pertinent to state that the affected firms are not barred from conducting businesses in Nigeria, however, their licenses to operate in their previous capacities as PSPs and Switch operator is what is revoked for the time being.
- According to an earlier modified guideline released by CBN two weeks ago, the minimum capital requirements to operate in Payment Service Providing and Switching/Processing capacities are N100 million and N2 billion respectively.
- Some of the services provided by a Payment Service Provider and Switch operators include; POS terminal deployment and services, PTAD, Merchant/agent training and support, switching, card processing, transactions clearing and settlement agents etc.
READ: “No forex” banks tell holidaymakers desperate for travel allowance (PTA)
What they are saying
Excerpts of the press release reads:
- “I, Godwin Ifeanyi Emefiele, Governor of the Central Bank of Nigeria, in exercise of the powers conferred on the Central Bank of Nigeria under Sections 60 and 62 of BOFIA, CAP B3, Laws of the Federation of Nigeria, 2004 hereby revoke the licenses of the payment service providers listed in Schedule I and the switch licence of payment services providers listed in Schedule II attached hereto.”
Debt Securities
Interest rates will remain low until the end of H1 2021 – Meristem Securities
Meristem Securities has argued that interest rates will remain low until, at least, the end of H1 2021.
Meristem Securities has asserted that interest rates will remain low until, at least, the end of H1 2021.
This statement was made at the recently held webinar on Global Economy and Outlook, which the company themed: Bracing for a Different Future.
Although the company acknowledged that there is mounting pressure for upward movement in yields from several stakeholders, it appears the company concurs nothing concrete is in sight.
This line of reasoning seems to have influenced their decision to advise investors to move away from Treasury instruments.
What they are saying
Meristem advises that:
- “Buy and hold strategy investors seeking to generate above average returns should move away from risk free Treasury instruments and focus on investment grade commercial papers and bonds which satisfy investment objectives.”
- “Active traders with higher risk appetite are advised to focus on high-yield short duration instruments, which would be re-invested into a higher yield environment should rate reversals occur.”
The advice regarding shunning Treasury instruments appears to be in order, considering that treasury bill rate has been declining, with the latest figure — November 2020 — 0.03% as per the CBN monthly interest rate data.
Further checks from the Debt Management Office website, indicates that the latest figures for Eurobonds and Diaspora bond fall short of the fixed yield at issue for all the different categories of bonds in issue.
What you should know
Latest figures from the CBN’s monthly interest rate indicate that:
- Treasury bill rate has been on a steady decline for six months, down to 0.03% since the last rise (2.47%) in May 2020.
- Fixed deposit rates (one, three, six and twelve months) have also been declining – the latest figures for these indicate that in November 2020, one-month deposit rate was 1.92%, 2.9% for three months, 2.84% for six months, and 4.89% for 12 months.
- Compared with the corresponding period in 2019, the figures indicate that these rates fell by 75%, 66%, 71% and 49% respectively.
Financial Services
CBN issues framework for QR payments
CBN has issued a framework that would guide Quick response (QR) code payments in Nigeria.
The Central Bank of Nigeria has issued the framework that would guide Quick Response (QR) Code Payments in Nigeria.
This is a proactive move by the Apex bank towards ensuring the safety and stability of the Nigerian Financial System, as well as promoting the use and adoption of electronic payments and foster innovation in the payments system.
READ: Over 1 million people took loans from banks below 20% interest rate in 1 year- CBN
Quick Response (QR) Codes are matrix barcodes representing information presented as square grids, made up of black squares against a contrasting background that can be scanned by an imaging device, processed and transmitted by appropriate technology.
The codes are used to present, capture and transmit payments information across payments infrastructure and further enable the mobile channel to facilitate payments and present another avenue for promoting electronic payments for micro and small enterprises.
READ: Binance offers DeFi coders $100,000; DeFi market value hits $8 billion
What you should know
- Quick Response (QR) codes are two-dimensional bar codes. QR code payments allow merchants to receive payments from customers simply by scanning generated QR codes using a smartphone camera. The QR code payments carry the purchase transaction information to the mobile device of the buyer/customer.
- Making payments via QR codes is very secure. It is because the QR code is nothing but just a tool that is used to exchange information. Any data which is transferred via QR codes is encrypted, thus making the payment secure.
- The Participants in QR Code Payment in Nigeria include Merchants, Customers, Issuers (Banks, MMOs and Other Financial Institutions), Acquirers (Banks, MMOs and Other Financial Institutions) and Payments Service Providers.
- QR payments are increasingly becoming a popular means of payments in Nigeria, and some industry players would see the framework as a perfect way of regulating the sector.
- QR codes are capable of storing lots of data. But no matter how much they contain, when scanned, the QR code should allow the user to access information instantly. It can be used for payments, sharing contacts and Wi-Fi passwords and lots more.
- The popular and common argument is that since POS machines are expensive, cheaper options such as QR scanners should be pushed forward to local traders.
READ: Telecoms, FSI to hugely boost Nigerian Economy in 2021 – CWG’s Business Director
Financial Services
CBN unveils framework for regulatory sandbox operations
CBN has issued a regulatory Sandbox framework towards engaging with the operators in the Fintech space.
Anonymous
December 25, 2020 at 1:17 am
Ok. I have just read this and would see more.
Chiedu Aligbe
December 25, 2020 at 6:16 am
They shoukd really look into their services. Since 13th November, my wife carried out a transaction in kurudumarket in Abuja for N10,000 which she was debited for but never paid and we have followed up with her bank Gtbank and even written severally to CBN on the matter via email and even engaged the service provider of the POS paypoint ITEX and they are still treating it with levity for someone’s hard earned money.