Nigerian apex bank to implement new e transaction pricing policy

You're referring to the recent announcement by the Central Bank of Nigeria (CBN), the apex bank of Nigeria, regarding the implementation of a new e-transaction pricing policy.

Here's a summary of the policy:

Background: The CBN has been working to promote the adoption of electronic payment systems in Nigeria, which has led to a significant increase in e-transactions. However, the increasing volume of e-transactions has put pressure on the payment system, leading to concerns about the sustainability of the current pricing structure.

New Policy: To address these concerns, the CBN has introduced a new e-transaction pricing policy, which aims to promote the use of electronic payment channels while ensuring the sustainability of the payment system. The policy is designed to encourage banks and other financial institutions to reduce their transaction costs and pass the savings on to customers.

Key Features:

  1. Tiered Pricing: The policy introduces a tiered pricing structure, with different pricing bands for different types of e-transactions. The pricing bands are based on the value of the transaction, with higher-value transactions attracting lower pricing.
  2. Discounts for Bulk Transactions: The policy offers discounts for bulk transactions, which are defined as transactions with a value of N1 million or more. This is intended to encourage large-scale transactions and promote the use of electronic payment channels.
  3. Increased Pricing for Low-Value Transactions: The policy introduces higher pricing for low-value transactions, which are defined as transactions with a value of N5,000 or less. This is intended to discourage the use of cash for small transactions and promote the use of electronic payment channels.
  4. Pricing Caps: The policy sets pricing caps for e-transactions, which are designed to prevent excessive pricing by banks and other financial institutions.

Implementation Timeline: The new e-transaction pricing policy is expected to take effect from January 1, 2023.

Impact: The policy is expected to have several benefits, including:

  1. Increased Adoption of Electronic Payment Channels: The policy is designed to promote the use of electronic payment channels, which can help to reduce the use of cash and promote financial inclusion.
  2. Reduced Transaction Costs: The policy is expected to reduce transaction costs for banks and other financial institutions, which can help to increase their profitability.
  3. Improved Payment System Efficiency: The policy is designed to promote the use of electronic payment channels, which can help to improve the efficiency of the payment system.

Overall, the new e-transaction pricing policy is expected to promote the use of electronic payment channels, reduce transaction costs, and improve the efficiency of the payment system in Nigeria.