Banks striving to break barriers with technology payment upgrades
Banks and financial institutions in Nigeria are constantly pushing technology barriers to upgrade their payment systems and channels, moving the nation closer to a cashless market, BusinessDay observes.
Experts say the growth of the payment industry in Nigeria is fostered by technology, as the payment cards market is anticipated to slow as a result of an uptake in mobile and contactless payment systems in the country, which banks have identified as a competitive advantage.
Alternative payments that offer security and convenience are gradually gaining prominence in Nigeria, with banks and payment solution providers launching services. In 2016, MasterPass, by Mastercard in association with Ecobank was launched. Similarly, Visa and Nigeria-based technology company JORG Technologies, launched mVisa and Nairabox respectively.
Other alternative payments available in the market include PayAttitude by six banks: UBA, Access Bank, FirstBank, Zenith Bank, Skye Bank and Diamond Bank, Verve World and PayPal.
“Banks are now shifting focus from delivering services through traditional brick-and-mortar branches and that is why Wema Bank launched Alat. The advent of digital banks in the country is likely to accelerate a shift towards electronic payments in Nigeria,” Dele Adeyinka, the Chief Digital Officer of ALAT, told BusinessDay in an interview.
The transitioning in Nigeria’s payments industry has been quite revolutionary, from the use of paper cheques which are now almost extinct.
The first main technology upgrade in Nigeria’s payment system was with the introduction of ‘Flash me cash’ by First Atlantic Bank in the year 2002 with the commencement of GSM operations in Nigeria. The product was launched as an alternative, to allow electronic money and payment transfer through the GSM phones.
Interswitch broke into the payments market in 2006 with Automated Teller Machines (ATMs) as an instrument to aid banking operations; using ‘switching’ infrastructure to connect the different banks in Nigeria and providing the technology for the use of ATM cards for cash withdrawal, bill payments, funds transfers, mobile phone top-ups and much more. The introduction of Point of Sales (PoS) terminals also increased the use chip and pin cards for payment transactions in the country.
However, the quest for a cashless society and the growth of e-commerce in Nigeria gave rise to a step up in technology and saw the likes of Paga, Quickteller, PayAttitude, among others, spring up.
Visa recently launched its latest innovative payment solution, mVisa, which offers customers the convenience of making cross border payments, using mVisa, through their regular mobile banking apps, by using the camera on their phones to capture a unique quick response payment barcode.
Uzoma Dozie, Group Managing Director and Chief Executive Officer of Diamond Bank said at the launch of mVisa, that; “With mVisa, Diamond Bank has raised the bar for cashless banking in Nigeria by maintaining its leadership role in driving digital financial revolution in the country. Our customers will be able to make everyday payments, simply by using their mobile phones. I think mVisa is the biggest thing that has happened in the industry.”
With this new technology, business merchants, who before now, had to either purchase a Point of Sales Terminal (PoS), which can be somewhat unreliable, due to sometimes slow network connectivity, or accept cash only, now have the option of using the innovative Quick Response (QR) mobile technology that reduces cost and friction for accepting electronic payments.
A QR code is the trademark for a type of two-dimensional barcode at the bank, which is designed to be unique to the retailer. To accept payment or process refunds, the customer only has to scan the barcode with his or her smartphone, through their existing mobile banking app, making payment much easier and faster.
Andrew Torre, President for Visa Sub-Saharan Africa, who spoke to media stakeholders at the launch of mVisa, said; “Small and medium merchants in particular, no longer have to invest in expensive point of sale infrastructure, as mVisa gives them the freedom to accept payments in a convenient, secure and affordable manner that their customers trust.”
Access Bank also launched PayWithCapture with QR code scanning, which allows person-to-person transfers, social banking, and savings club, amongst others, all with the use of a mobile phone. Fidelity Bank, First Bank, Zenith Bank, Ecobank and United Bank for Africa (UBA) are some of the other banks that have lauched the use of this innovative barcode scanning payment technology.
For non Smartphone users, the platform also runs on USSD service, which allows users to carry out transactions without the need to access the internet.
Systemspecs also launched Remita, a payment platform that was termed a disruptor of Nigeria’s Fintech industry. Remita app is a payment collection platform, designed to help individuals and businesses manage their accounts across multiple banks, settle bills of various kinds, make payments and generally stay in control of their finances seamlessly.
“There is nothing like too much when it comes to technology. Everybody just wants something that would make life and in this case, transactions, much easier and that is what has driven us to bring this useful product to everybody.
“We would also be using artificial intelligence to handle your personal financial management, which would tell you what you need to pay for and when you are spending too much money, depending on your usual spending pattern,” Deji Olowe, Executive Director, Products and Services, Systemspecs, said at the launch of the Remita app in Lagos recently.
Industry watchers have however called on financial institutions to not only focus on technology for easy payment services but also tighten payment security in order to curb cyber theft.
Speaking on how secure these new alternatives to financial transactions are, John Obaro, CEO, Systemspecs told BusinessDay that; “The thing about technology, is that security is in-built in different layers. We now have a lot of advanced security and anti-fraud measures which are updated and upgraded as technology advances.”
Jumoke Akiyode Lawanson
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