PFS enables CBN speed up cheque truncation across Nigeria

As part of ongoing efforts by the Central Bank of Nigeria (CBN) to shorten the settlement cycle of a cheque to one day, the apex bank is working with Nigeria Inter-Bank Settlement Systems (NIBSS) and leading financial services software provider, Precise Financial Systems, PFS, to achieve this objective thereby ensuring cheques presented for settlement are resolved within stipulated date across the country.

PFS and NIBSS have enabled the CBN to execute the project, as the cheque truncation platform has gone live in Lagos and Abuja.

Other branches of the CBN would be concluded by the end of March, PFS said in a statement.

The cheque truncation system would allow all branches of the CBN to capture all cheques in the respective branches and maintain them in a central server in Lagos.

The system then allows all captured cheques from the bank to be transmitted to the clearinghouse from Lagos.

Yele Okeremi, managing director/chief executive officer of PFS, said the system is responsible for the processing of all inward cheques and NEFT transactions of banks.

While it would address all required management reporting, its controls are guided “as the system implements all required maker checker rules of the banks”, he said.

With the activation of cheque truncation regime through iTELLER platform in Nigeria, one important challenge the system has addressed is the ability of the CBN to meet the deadline for cheque truncation nationwide. Aside, the platform has also assisted the CBN to reduce cost, time and the stress involved in its cheque clearing operations, as the system removes all “logistics costs associated with clearing”.

While further enumerating on the benefits of cheque truncation system, he said before the new regime, Nigerian banks would have to send their outward cheques to respective central clearing departments by dispatch riders or bullion vans. There would not be any need for that again, as cheques can be truncated directly at the branch of deposit. 

BEN UZOR JR