The Central Bank of Nigeria (CBN) on Wednesday issued Approvals in principle (AIP) to three Payment Service Banks (PSBS).
This according to the regulators was in line with its objective of enhancing financial inclusion and the development of the payment system by increasing access to deposit products and payments services through a secured technology-driven environment.
The three institutions issued approvals in principle to operate as Payment Service Banks are Hope PSB, Money Master PSB and 9PSB.
This was disclosed in Abuja by Isaac Okorafor, director, corporate communications department of the CBN, who explained that the approval in principle was part of the processes the institutions had to fulfil in order to be granted license to operate as fully-fledged Payment Service banks.
According to Okorafor, the decision of the CBN to issue the AIP to the applicants followed the institutions’ satisfaction of documentation and other laid- down conditions.
Sequel to the issuance of the AIP to the three banks, he said they are expected to submit their respective applications for the grant of a final licence, not later than six months after the AIP.
Speaking further, he disclosed that the CBN code of corporate governance for banks would also be applicable to the PSBS.
PSB is a payment service initiative proposed by CBN in which Banking agents, Mobile Money Operators (MMOS), Retail chains (Supermarkets), Telecommunications companies (Telcos) who are able to present an initial capital of N5 billion will be given license to operate under the structures and guideline specified by the apex bank, with the motive but not limited to ensuring access to financial services for the unbanked rural segments of the society.
On the 5th of October 2018, the apex released an exposure draft guideline in which it proposed PSB aimed at deepening financial inclusion in a country where only half of its total adult population are included in the financial cycle.
Godwin Emefiele, governor of the CBN said in his five-year policy thrust that the ultimate objective of the Bank was to ensure that 95 percent of eligible Nigerians have access to financial services by 2024.
He said over the next five years, through initiatives and policy measures such as the Shared Agent Network (SANEF) and the payment service banks, the Apex bank intend to broaden access to financial services to individuals in underserved parts of the country.
Latest figures by EFINA put Nigeria’s financial inclusion rate at 63.2percent, meaning that as much 36.8 percent adults still lack access.
In the quest to ensure more of Nigeria’s adult population are granted access to financial services, the industry regulator through its collaboration with industry stakeholders launched the National Financial Inclusion Strategy (NFIS) in January 201.
Through the initiative, the CBN projected that it would ensure 80 percent of Nigerian adult population are included into the financial cycle by the year 2020.
Checks by Businessday revealed that at least 30 business names are currently undergoing registration as payment service banks with the functions to: maintain savings accounts and accept deposits from individuals and small businesses, which shall be covered by the deposit insurance scheme; carry out payments and remittance (including crossborder personal remittance) services through various channels within Nigeria; issue debit and pre-paid cards; and operate electronic purse.
