Innovation is a fact of life in any sector and the payments industry is no exception. One of the consequences of the IT revolution has been the proliferation of innovative payment systems. An e-commerce payment system facilitates the acceptance of electronic payment for online transactions. E-commerce payment systems have become increasingly popular due to the widespread use of the internet-based shopping and banking.
Thus, the plan by the Central bank of Nigeria (CBN) to develop end-to-end value chain systems that can be implemented in various industry verticals, as well as to increase the level of adoption of electronic payments in Nigeria as reported recently is a welcome development. The banking and financial services industry has played an integral role in promoting the CBN cashless policy; extending the usage of electronic channels in the non-banking sectors of the economy such as agriculture, hotels and entertainment, transport, education, and health will no doubt further promote the cashless policy.
Over the years, credit cards have become one of the most common forms of payment for e-commerce transactions. In North America almost 90 per cent of online B2C transactions were made with this payment type.
Statistics show that about 25 per cent of the global economy involves mobile payments, and according to experts at the 5th Emerging Markets Payments Conference (EMPC) that took place in Sharm El-Sheikh recently, 2014 has already witnessed a 400 per cent increase in global mobile payment transactions, compared to 2011. Furthermore, it was revealed at the conference that the world needs more efficient and trustworthy electronic payments ecosystem, revealing that mobile users will reach 4 billion in 2017; Governments across the globe are willing to support the growth of the electronic payments market industry, motivated by the realisation of the benefits electronic payments have on the economy and the correlation between enabling citizens to have access to electronic payments and achieving further GDP growth.
E-payment usage has a lot of advantages which includes, making payment swiftly and remotely; easy tracking of payment to beneficiaries account to assist in audit trail; overall increase in the efficiency of operation; reduced transactions of very low value; and Increase in convenience of payments. It is also very helpful in the war against corruption, and agencies like Economic Financial Crime Commission (EFCC) and Independent Corrupt Practices Commission (ICPC) can depend on the system in cases of investigation.
The speed and simplicity with which cyber-mediary accounts can be established and used have contributed to their widespread use, although the risk of abuse, theft and other problems with disgruntled users frequently accusing the mediaries themselves of wrongful behaviour is associated with them. In fact, despite widespread use in North America, there are still a large number of countries such as China, India and Pakistan that have some problems to overcome in regard to credit card security.
The problems militating against e-Payment includes integrity that transmitted financial information is unchanged in transit; non-repudiation to ascertain that all parties have non-deniable proof of receipt; confidentially that transactions are protected from possible eavesdroppers; reliability that there is reduced possibility of failure; and authorization that individuals are recognized and granted the desired rights and privileges
While we give kudos to the CBN for the success of the cashless policy so far, we call for intensive and extensive public education and awareness creation by the CBN on usage of e-payment. Because, we know that the pervasiveness of e-payment systems would lead to crashing of all transaction costs and near-total extinction of all barriers to financial transaction; as well as helping to achieve economic and efficient financial transactions and enhancement of real-time reporting as well as improvement of quality of financial reporting system; however, the government should provide the needed leadership and support for electronic payments by ensuring that all aspects of financial transactions by the MDAs, and the three tiers of government are conducted via e-payment.
