Nigerian Interbank Settlement System Plc (NIBSS) has issued a directive affecting non-deposit-taking financial institutions.
Gatekeepers News reports that the circular mandates banks to exclude such institutions from the Nigeria Interbank Payments (NIP) fund transfer channels.
The non-deposit-taking financial institutions include switching companies, payment solution service providers, and super agents. The NIP fund transfer channels include USSD, mobile banking apps, POS, ATMs, plus web and internet platforms.
NIBSS Executive Director of Business Development, Ngover Ihyembe-Nwankwo emphasised that this action aligns with the Central Bank of Nigeria (CBN)’s Guidelines on Electronic Payment of Salaries, Pensions, Suppliers, and Taxes in Nigeria dated February 2014.
According to the circular released by it, “listing non-deposit taking financial institutions such as switching companies (switches). Payment Solution Service Providers (PSSP), and Super Agents (SA) as beneficiary institutions on your NIP funds transfer channels contravenes the CBN Guidelines on Electronic Payment of Salaries, Pensions, Suppliers and Taxes in Nigeria dated February 2014.”
While the affected financial institutions can process outward transfers to banks, they cannot receive fund inflows as their licenses do not permit them to hold customer funds.
“For clarity, Switches, PSSPs, and SAs may process outward transfers as inflows to Banks but are not to receive inflows as their licenses do not permit to hold customers’ funds.”
Consequent to the directive, the NIBSS, which manages Nigeria’s widely-used instant payment system utilized by all financial service providers, has instructed banks, mobile money operators, and microfinance institutions to deactivate external fund transfers to wallets operated by these companies.
