Nigeria’s central bank launched a national domestic card scheme, AfriGo. This introduces the central bank to the market of card payment schemes in Nigeria’s card payments sector in a bid to strengthen the cashless economy.
Godwin Emefiele, Governor of the Central Bank of Nigeria (CBN) in partnership with the Nigeria Inter-Bank Settlement System (NIBSS), unveiled another first of its kind in Africa, a Central Bank-led National Domestic Card Scheme – AfriGo saying that the new policy is aimed at providing more options for domestic consumers whilst also promoting the delivery of services in a more innovative, cost-effective and competitive manner.
The CBN governor explained that the card would be accessible to all Nigerians and is expected to strengthen the national payment system and strengthen the usage of electronic platforms in Nigeria.
“The domestic card scheme is expected to strengthen the national payments system and deepen the usage of electronic platforms in Nigeria,” Emefiele said.
What is the Afrigo Card?
The Afrigo card is a national domestic card scheme, created by the CBN to perform domestic transactions within Nigeria like existing debit cards. The Afrigo card allows the CBN to compete with international payment companies like Visa, Mastercard, Verve, and Interswitch in the valued $18.2 billion Nigerian cards and payments market.
What is its difference from existing debit cards?
The new card is produced by the apex bank and offers cheaper transaction fees. It is for only transactions within the shore of Nigeria while existing cards like the naira debit/credit cards perform domestic transactions while domiciliary cards perform international transactions and are all produced by Visa and Mastercard through commercial banks.
Emmanuel Ogiefa, head of internal audit control in the banking and finance sector said “Existing naira credit/debit cards, and dollar cards perform domestic and international transactions respectively, and they will still exist, but the Afrigo card will reduce its dominance in the card payment industry in Nigeria through competition.”
What are its benefits?
The Afrigo card functions as a debit card and will be linked to your E-Naira.
It will greatly address fraud, improve transactional security, reduced demand for FX and less pressure on locally relevant partnerships and offerings, develop local skills in cards & boost financial inclusion.
The CBN Governor assures Nigerians that the card scheme will open more opportunities for the Nigerian economy to integrate the informal segment of the economy, reduce shadow banking and bring more Nigerians into formal financial services
“Rather, it (AFRIGO) is aimed at providing more options for domestic consumers whilst also promoting the delivery of services in a more innovative, cost-effective, and competitive manner,” he said.
How does it affect the cashless economy?
Despite the penetration of card transactions for over a decade, cash transactions are still very predominate in Nigeria, the Afrigo card is aimed at reaching the unbanked thereby increasing financial inclusion and strengthening the cashless policy society through its promises of cheaper charges. Emefiele said that it will address the majority needs of Nigerians which are micropayments and that the card is set to capture the dynamics of such transactions.