To further promote a cash-less economy and enhance the collection of applicable government revenues, the Central Bank of Nigeria (CBN) has announced a review of the process for merchant settlement.
With effect from September 17, 2019, the CBN has approved for banks to unbundle merchant settlement amounts and charge applicable taxes and duties on individual transactions as stipulated by regulations.
A statement signed by Sam Okojere, director, payments system management department at the Bank, , also announced a downward review of the Merchant Service Charge (MSC) from 0.75 percent capped at N1,200 to 0.50 percent capped at N1,000.
Meanwhile, the CBN, in a circular to all deposit money bank (DMBs), also announced the commencement of charges on deposits in addition to already existing charges on withdrawals.
According to the circular, the charges, which take effect from Wednesday, September 18, 2019, will attract 3% processing fees for withdrawals and 2% processing fees for lodgments of amounts above N500,000 for individual accounts.
Similarly, corporate accounts will attract 5% processing fees for withdrawals and 3% processing fee for lodgments of amounts above N3,000,000.
The statement, however, disclosed that the charge on deposits shall apply in Lagos, Ogun, Kano, Abia, Anambra, and Rivers States as well as the Federal Capital Territory. It added that the implementation of the cash-less policy would take effect from March 31, 2020.
The CBN on Tuesday also rescheduled the number 269 Monetary Policy Committee (MPC) earlier scheduled for Monday, September 23 and Tuesday, September 24, 2019, to now hold on Thursday, September 19 and Friday, September 20, 2019.
In a statement signed by Isaac Okorafor, director, corporate communications, the CBN regretted all inconveniences caused by the change.
Efforts by BusinessDay to know the reason for the reschedule was not successful as the CBN spokesman could not respond to his calls.
Analysts said last night that it could be that the CBN has one assignment on the earlier date that triggered the rescheduling.
However, analysts in the financial market expect no change in the Monetary Policy Rate (MPR) as the MPC members begin their two-day meeting on Thursday in Abuja.
Ayodeji Ebo, managing director, Afrinvest Securities Limited said the MPC may be looking at the level of compliance by banks to the CBN’s policies particularly the 60 percent Loan to Deposit Ratio (LDR). Apart from that he expects to see the move of the fiscal authority regarding the state of the economy.
The CBN had given the banks September 30 deadline for the commencement of 60 percent loan to deposit ratio, which was targeted at increasing credit to the real sector of the economy.
The regulator said after the July MPC meeting that would after September 30, 2019, begin a month by month monitoring of compliance to LDR by Deposit Money Banks.
Johnson Chukwu, managing director, Cowry Asset Management Limited expect the CBN to keep rate at current level.
He said although inflation rate moderated further to 11.02 percent year-on-year (from 11.22 percent in July 2019), the slowdown in Gross Domestic Product (GDP) calls for greater concern.
The National Bureau of Statistics (NBS) released the second quarter GDP data recently and the numbers were disappointing. GDP growth rate slowed to 1.94 percent despite a more than five percent growth in oil GDP.
“A disappoint, GDP result yet again for Nigeria, with growth decelerating to 1.9 percent year/year in second quarter (Q2_ 2019, from a revised 2.1 percent y/y in first quarter (Q1) said, Razia Khan, managing director, Chief Economist, Africa and Middle East, Global Research, Standard Chartered Bank, who also said “although Q2 disappointed our expectation, weak growth itself should not have been too much of a surprise”.
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