CBN partners e-payment body to promote Point of Sale cashless transactions

Osa Victor Obayagbona

The eventual introduction of Point of Sale e-payment terminals will definitely usher in an era of cashless transactions along with its numerous attendant benefits

The Central Bank of Nigeria (CBN) has held high-level meetings with key stakeholders in the electronic payment industry in order to promote an end-to-end e-payment through the growth of Point of Sale (PoS) terminal usage in the country.

Tunde Lemo, deputy governor of CBN on financial surveillance, who revealed this recently at the official presentation of a white paper on PoS as an e-payment channel, by  members of the E-Payment Providers Association of Nigeria (E-PPAN), said the nation’s financial regulatory body was committed to the promotion of a cashless economy, saying: “Presently, the CBN spends a lot of money to print, distribute and destroy the currency; and the average life-span of a naira note is six months.”

Lemo noted that though Nigerians had embraced the usage of e-payment system with the introduction of ATM services, the ultimate aim was the adoption of the usage of PoS transactions, which reduces the handling of cash.

While commending the E-PPAN team for its efforts at promoting a cashless society in Nigeria, Lemo also approved all the recommendations presented by the body for the growth of PoS terminals usage in the country. E-PPAN therefore recommended that the CBN should set up a committee to implement effective guidelines for PoS usage, based on the white paper, as it defines the roles, responsibilities and processes for all the players in the industry. If this is done, it would help to create an enabling framework and environment to encourage the proliferation of the PoS channels.

The body also asked the CBN to engage the National Communications Commission (NCC) and the telecommunications companies to provide reliable data services to the e-payment industry, as the dearth of accurate data remains a major challenge in the industry.

Also at the meeting were Mac Atasie, president, and Onajite Regha, coordinator, E-PPAN. While commenting on the content of the white paper, Atasie explained that in the document, E-PPAN had proposed solutions to the CBN, noting that “industry players have also come up with strong recommendations that, if diligently followed, would put PoS in an enviable position within the payment system in Nigeria”.

A PoS terminal is a computerised substitute for a cash register, and is much more composite than the cash registers of even just a few years ago in developed economy. The PoS system can include the ability to record and track customer orders, process credit and debit cards, connect to other systems in a network, and manage inventory.

On the whole, the PoS terminal has as its core, a personal computer, which is provided with application-specific programmes and I/O devices for the particular environment in which it will serve.  The PoS system for a restaurant, for instance, is likely to have all menu items stored in a database that can be queried for information in a number of ways. PoS terminals can be used in most industries that have a point of sale, such as a service desk, restaurants, lodging houses, entertainment centres, and museums.

Increasingly, PoS terminals are also web-enabled, which makes remote training and operation possible, as well as inventory tracking across geographically-dispersed locations. There are two main types of systems: for retail stores; and for the hospitality industry, hotels and restaurants, for example.  The benefits of the systems include: · Accuracy: Scanning is more accurate than punching in numbers from a sticker, or expecting the cashier to remember what each item costs.

· Analysis: PoS systems let you manage inventory, flag items for reorder, and analyse sales patterns. The system is, at heart, a cash register, but because it is based on a personal computer, it opens up a new world of data about your business. The terminal can be networked to other terminals, and to a server in the back room or at another location. It can be expanded with handheld devices wirelessly linked to the main system. It can be used to fast track a number of operations and be customised to suit the needs of customers.

The main advantage of a computerised PoS system over a cash box or a cash register is the sophisticated and detailed sales reports it provides. The software lets you analyse sales in different ways, such as by: item sold, time periods, promotions, and store, if you have more than one, or even by sales clerk. It will help your inventory manager buy in the right number of cartons of items with improved timing, and help your clerk calculate how much goods to order for the coming week, taking into account an upcoming break; it can also help reduce the number of employees.

But that’s only the start. Once the sales are computerised, you can plug that computer into a network, and the network into a back-office computer system which downloads results from all your registers, consolidating and monitoring the information in a variety of ways. In spite of the advantages, it can be a little bit expensive for the up and coming entrepreneur as it can cost between N400,000 and N500,000 to install – as every installation comprises software, scanners, printers, installation, training, and support, plus costs for integrating into your back-end system.

Meanwhile, the benefits far outweigh any perceived drawback, as E-PPAN, proponents of the PoS terminal system in the country, is set to assist any outlet willing to have a try of the system without too much hassle. But once you grow in size – as you approach a sizable annual sales, and especially as you add retail outlets or restaurant locations – a computerised PoS system will not only pay for itself in improved efficiency, it will provide you instant access to all the critical information you require on the operation of your system.