Nigeria contactless payment frontiers and the ALAT NQR digital solution

Technology or digital innovation is disruptive in nature. It creates opportunities and further challenges the norm to open doors for more future opportunities. Because of the impact of disruptive technology, the financial services sector in Nigeria has also undergone and continues to undergo significant transformations with banks moving away from traditional over-the-counter transactions to smart, tech-driven digital services and products.

As banks increase their investment in ICT and the development of digital solutions, the adoption of the cashless economy policy of the government is up-scaling, as broadband utilisation is increasing: people’s quality of life is improving, and the banks are also up-scaling service efficiency and profitability.

With technology virtually taking over businesses and social activities in the 21st Century, the banking sector as a critical enabler of socio-economic growth is not an exemption from the innovation orchestrated by this phenomenon.

Earlier in August, Wema Bank, through its digital banking platform, ALAT, introduced the New Quick Response (NQR) Code to simplify payments, and boost convenient financial transactions across Nigeria. The recent introduction of the NQR code-based payments and collections solution by Wema Bank’s ALAT, Nigeria’s leading digital banking platform, typifies how banks in Nigeria are ramping up technology innovations to disrupt the banking ecosystem in positive ways.

The new feature on ALAT, known as NQR or quick response (QR), is a code-based payment and collections solution that provides fast, easy, secure, reliable, contactless, and account-based options to receive and pay for goods and services.

With the payment solution, merchants, business owners and individuals once they display the QR Codes generated on ALAT, instantly receive payments at their locations for goods and services with ease without having to make any physical contact.

“Payers/customers select the NQR option on their bank’s mobile application and scan the displayed NQR Codes to make payment to the merchant. Merchants/business owners and payers get instant notification of payment made,” the bank stated.

The benefits of the NQR on ALAT include simplicity of use, easy setup, zero cost of acquisition, and a seamless merchant onboarding process. Other benefits are super-fast deployment, instant payment and settlement, and fast and secured payment.

Much more, the level of transaction that can be done using the new feature is also determined by the payer’s bank, which means customers can negotiate more.

However, transactions below N250 would attract 50 kobo, while those between N25 and N999.99 would be charged N1. Transactions ranging between N1000 and N4,999.99 will attract N5, just as those between N5,000 and above would pay the applicable fee of N25. The icing on the cake is that ALAT payment platform offers the lowest service fees in the industry currently.

Transactions and information exchange on the platform are secure. “NQR on ALAT is safe, as the exchange of information via the QR code ensures that any transmitted data on the technology is encrypted, thus making the payment secure. Also, NQR is built around the universal EMVCO Security Standards. In addition, payers are protected by a secret 4-digit PIN used to consummate transactions and known to only the payer,” the bank further explained.

Onboarding on the payment platform has also been made easy. Customers can set up NQR on ALAT by first updating the ALAT app on their mobile devices to the latest version before login into the ALAT app as a payer. Then select payment, and QR payment to scan a code directly or from their galleries.

Merchants and receivers are also to log in to the ALAT app and select payments, and QR payments and then create merchant and sub-merchant display the QR code to receive payment.

The deployment of QR payments solutions by merchants, customers, and issuers including banks, mobile money operators, payment service providers and other financial institutions in Nigeria was enabled by the release of the Framework for Quick Response (QR) Code payments in Nigeria by the Central Bank of Nigeria (CBN), in January 2021.

The framework aimed to promote the use and adoption of electronic payments, foster innovation in the payments system, and strengthen the institutional framework for economic and financial industry stability in the country. Besides specifying the regulatory guidance, the framework also aimed to ensure the adoption of appropriate QR Code standards for safe and efficient payment services in Nigeria.

The CBN also permitted banks to use any other QR Code Standard provided they meet the prescribed security requirements, demonstrate interoperability with other existing implementations in the industry and/or offer cost benefits to end users (merchants and customers).

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On the threshold of the Fourth Industrial Revolution (4IR), a concept brought about by the rapid transformation of every aspect of our socio-economic life because of increasing interconnectivity and smart automation, banks in Nigeria have been migrating from analogue operations to digital platforms.

Massive investment in ICT infrastructure resulted in the deployment of Automated Teller Machines (ATM), mobile banking, electronic fund transfers, and the development of mobile applications and digital products/channels.

The quest to further explore opportunities offered by technological innovation led to the introduction of digital/virtual payment solutions and digital banking platforms such as ALAT, the flagship digital bank by Wema Bank.

Without a doubt, technological innovation has made it easier for banks to do real-time banking while customers access services faster and with ease. Customers are not only able to monitor their bank accounts and transactions from the comfort of their homes; they can order goods and make payments on their mobile devices and receive orders without physical contact.

Oni, an entrepreneur, writes from Lagos