The Nigerian Communications Commission (NCC) is to begin sim card registration in Lagos next week, Demola Aladekomo, MD/CEO, Chams, a global technology company and the authorised firm assigned to carry out the sim card registration by the NCC, said at the ennovators breakfast series event organised by Financial Technology magazine, a financial technology news portal in Lagos yesterday.
Mr. Aladekomo said for the past two weeks, the firm had carried out a pilot exercise, registering a few people to test run its efficiency.
The sim registration is coming amid criticism by many that the commission had no business doing that since the communication companies had earlier registered their customers.
He, however, said, “Sim card registration is not a strange process. It is happening in some other countries in the world too. It is not such a strange activity to be carried out,” adding that some countries such as Kenya, South Africa, and Botswana are among the series of other countries carrying out the activity.
The conflict of interest
Some Nigerians have condemned the exercise, following the supposed disconnect between the operators and the regulator on who to carry out the Sim registration exercise.
Mr. Aladekomo said there was a clear directive initially so that there would be no conflict in data gathering between the regulator and the operators of the telecoms industry.
“It was pretty clear initially. The NCC was to register all old sim cards because they were to use it to create a data base for the nation so that the nation can benefit, including serving as a database for the national identity, while the operators were to register new sim cards so that no one is excluded.
“Unfortunately, because of competition, the operators decided to register the old and the new sim cards and that created a lot of confusion in the industry,” he said.
According to him, from the way the operators were going about it, it was almost like the operators did not actually want the regulators to know all the number of sim cards they operated.
Some finance experts say the sim registration would help address some of the challenges of customer identification in the banking industry, which has to battle with identifying its customers especially when it comes to e-payment, mobile payment, and all the related banking activities.
The Central Bank too, has in the last few years, been seeking ways to help banks properly identify their customers’ at the most affordable means, to reduce cases of fraud in the industry.
Abayomi Atoloye, director, banking and payment system department, Central Bank of Nigeria, who gave the keynote address at the event, expressed optimism that the event will provide an opportunity for participants to discuss the “burning issue on multiplicity of SIM Card Registration” and the know your customer ‘KYC’ for efficient financial services delivery, as well as touch on developments in e-payments, and electronic banking in the past one year.
“I will, therefore, attempt to summarise the efforts of Central Bank of Nigeria in the development of Payments System in the last one year and the Regulatory Outlook for the Nigerian Payments System – especially, payments through the electronic cards,” he said.
According to him, the Central Bank of Nigeria had been making efforts under the Payments System Vision 2020, to promote and entrench electronic payments as the major channel for payment and settlement, by all economic agents, away from the current dominance of cash-based transactions.
“In this regard, mobile phone was identified as a channel for effecting electronic payment between person-to-person. Recently, the Central Bank gave approval-in-principle to 16 mobile payments scheme operators to enhance the person-to-person payments services in Nigeria,” he said.
As part of its policies to minimise the level of card fraud in the Nigerian Payments System, the regulatory body had directed banks to migrate all their cards from magnetic stripe technology to chip+PIN, otherwise known as EMV, due to the weaknesses of the former.
Also, the development of Guidelines for Credit Bureau Operations in Nigeria gave rise to the approval of three credit bureaus which have significant influence in promoting credit cards operations in the country.
The way forward
Mr. Atoloye said over the next few years, the Central Bank’s focus will be on strengthening the institutional and regulatory frameworks that would encourage financial inclusion of the unbanked and promote more usage of electronic payment, as clearly enunciated in the Payment Systems Vision 2020.
He added that some factors in particular are expected to drive the usage of electronic payments in the near future.
These include the application of mobile technology for financial services, especially in rural areas, which is expected to ensure that a large percentage of the population outside the formal banking system have access to financial services using one of the three scenarios of card-based, account-based, and virtual account. The draft National Payments System Bill, which is undergoing approval process and is expected to address legal barriers to electronic payments such as the admissibility of electronic evidence in the law court.
Also, the adoption of National Identity Number (NIN) as part of the requirements for opening of accounts is expected to address the challenge of unique identifier that affects the widespread of credit cards in Nigeria, while the adoption of electronic payments by organisations for payment of allowances to employee, pensioners, and social beneficiaries is expected to also boost card payment in Nigeria.
