The new technology in payment system is designed to ease the rampant movement of huge money from one place to another and help customers to access their account balances in not only their banks, but in any participating bank in the country. The idea of e-payment in Nigeria has come at a time when the country is trying to transform its economy along the lines of global information and communication technologies (ICTs).
The first licence to operate e-payment services in the country has been issued to Cash Technology Limited (CTL) recently by the nation's apex bank.
The notice of the approval was contained in a letter dated April 7, 2004 to the chairman and chief executive of CTL and signed by the director of banking supervision, CBN. The letter of approval said: "We write to convey the approval of the CBN for your company to operate a financial cards transmission switching facility."
CTL has been appointed as the first master card international member services provider in the African region some two years ago but since then, the company was unable to transact effectively its services in the country due to lack of approval by CBN and collaboration between switch operators within the system. This recent approval to the company is seen as significant in the evolutionary trend of e-payment system in Nigeria.
Among the key benefits of the smart cards is the enhancement of the speed and efficiency of financial transaction, and the stimulation of more dynamic economic activities, cash based transaction, tune down the pitch of business acquisition of goods and services, making it more complex and cumbersome, and therefore sometimes limiting the volume and value of transaction, and consequently productivity.
However, ICT experts believe that, the need to de-emphasise cash-based economic activities is increasingly becoming more appealing than ever, with the recent introduction of higher currency denominations, which has helped to portray the benefits of simplified transaction process on the level of business activities.
These benefits and many more have made the system become imperative for e-government and e-commerce to thrive in the economy.
Highlighting some benefits of e-payments in Nigeria, the director-general, National Information Technology Development Agency (NITDA), Professor Gabriel O. Ajayi said, for e-commerce to take-off there has to be in place a low cost, user-friendly, reliable and secure means of payments for goods and services rendered. This should also include the presence of reliable and trustworthy payment vehicle.
Ajayi said: "If the entire system will recognise the use of electronic payment there should be reduction in social vices like armed robbery, corruption and 419 activities, since the society will be transformed to a more cashless society."
The CTL's head, business development, Mr. Niran Oladunni, said, if a bank is connected to the firm's switching facility, it would have an advantage of multiple transactions settlement among customers.
He said, while elaborating how the system will assist in quick transaction, that, "if bank A,B,C and D are on CTL network a customer of bank A who has the master card could walk into bank B and use its Automated Teller Machine (ATM) to make financial transactions which will be facilitated from CTL office using a switching centre. But the big challenge lies in adapting these technology to the peculiar characteristics of the Nigerian environment and discovering creative routes to solving problems arising from implementing them. Important issues in treating these problems are lucky to capture the vulnerability of the system and the confidence profile of users rather than choice of technology.
Even though it has granted the first licence for the operation of the cashless transaction, CBN has categorically stressed the need for preventive measures by the CTL to avoid any threat to the system.
The CBN advised the company to endeavour to keep upgrading its security measures in line with development in the information and communication technology (ICT) industry in order to avoid any security threat in the future.
Security integrity of operators and confidentiality of e-payment transactions are viewed as prominent factors that will guide users and customers' acceptance of the system.
Mr. Adesina A. Fagbenro is a legal practitioner. He said in a paper entitled: Cyber crime: The Nigerian challenges, that cyber fraudsters can target credit card information, or any other financial information to counterfeit. No longer do credit cards need to be stolen, specialised hardware and software programs can encode falsified information on credit card magnetic strips to obtain value fraudulently.
"The case of Advance Fee Fraud or 419, obtaining money by false pretences through the Internet or electronic means are notoriously of Nigerian parentage," said Fagbenro.
"FBI information has revealed that Nigeria is third in the world out of the total number of frauds in electronic transactions with 4.81 per cent of the world's Internet fraud, he added.
According to him, "global adaptation of the Internet, for economics, financial, social and educational purposes have given rise to new challenges in the area of computer related crimes. With the exponential growth of Internet connection, the opportunities for cyber crime or exploitation of any weakness in information security are multiplying by the second.
However, the Attorney General of the Federation and the Minister of Justice, Chief Akin Olujinmi said recently at an information and communication technology (ICT) forum organised for judicial, law enforcement, intelligence and security officers in Nigeria, started by asking questions on whether Nigerians are not over-exposing themselves to forces beyond their control.
He said, "we are asking what the real price of ICT modernisation is? We are asking whether our systems are even adaptable to ICT in the first place."
According to one story narrated by Olujinmi during the forum, there was a time a man from Lagos who found that a book he had been searching for in local bookshops for more than a year, "Cyber security for dummies," was available on the website of the popular Internet bookseller, Amazon.dot.com. He got his bank in Lagos to pay for the book, using the bank's credit card. However, more than three months down the line, the book did not arrive and the bank has of course debited his account. And Amazon.dot.com has received the payment for the book.
As a result of this modern electronic transactions known as e-commerce, "we are not only able to pay for products and services in Nigeria, but we can now pay for goods and services from anywhere in the world. What system are we putting in place to ensure that parties do not disregard attendant rights and obligations? Where does the book buyer, who has not received his book after three months turn? Would our courts issue him a judgement that is recognised and enforceable in California, where Amazon.dot.com is located? What about the bank that made the credit card payment? Does it have a system of getting the money back on grounds of failure of consideration?, asked Olujinmi.
He said that almost every bank in Nigeria today has one form of Internet banking or the other. What sort of safeguard measures are banks taking to ensure that their systems are not open to abuses and intrusions, from within and outside the banks. Many of these are part of the challenges the government, banks and other stakeholders have to confront head on for Nigerian to successfully carry out e-transactions.
In this regard it is essential for the federal government through its agencies regulating ICT to take a second look especially in the e-payment system which will involve cash transaction via electronic means to avoid huge losses that may occur in the economy.
Quelle: AllAfrica, 03.05.2004
