The Central Bank of Nigeria (CBN), in conjunction with the Nigeria Inter Bank Settlement Systems (NIBSS) Plc, the Bankers Committee and other financial ecosystem stakeholders, will today launch the National Domestic Card Scheme.
The scheme is tailored to address the specific requirements of Nigeria’s payment industry and provide innovative offerings tailored to the Nigerian market and beyond.
The scheme, according to the CBN, will transform the domestic and African payment landscape through the promotion of innovation in the payment, enhancement of interoperability domestically and internationally and improvement in the suite of products and solutions offerings by banks and other financial institutions such as debit, credit, virtual, loyalty and tokenised cards.
The CBN said, “The National Domestic Card set to be delivered to over 200 million Nigerians offers unique value propositions through enhanced data sovereignty and transaction security, better pricing opportunities, reduced demand for FX, enhanced financial access and support of the growth of a robust and inclusive digital economy, amongst others.”
CBN meets Sokoto traders over rejection of old notes
CBN meets Sokoto traders over rejection of old notes
The brand launch of the new Domestic Card Scheme will take place on Thursday, January 26, at a virtual event that will be graced by critical stakeholders in the financial ecosystem such as the Governor of the CBN, Deputy Governors of the CBN, the Director General, Securities and Exchange Commission (SEC) and Managing Director of the Nigeria Deposit Insurance Corporation.
“The launch presents a new dawn in the Nigerian payment ecosystem and unveils the unique opportunities presented by the Nigerian retail landscape, charting the future of the payment landscape as the first Domestic Card Scheme to be launched on the African continent,” the CBN said in a statement.
It will boost data sovereignty, financial inclusion – Fasua
Reacting to the development, an economist and CEO of Global Analytics Consulting, Dr Tope Fasua, said the domestic scheme would bring data sovereignty to Nigeria and also aid some monetary policies of the CBN.
He said, “Nigerians did about $18.2 billion of card transactions in 2021. Most, if not all of the debit cards in our system today, are issued by the global behemoths, Mastercard and Visa. Procuring those cards costs customers quite some money and so does maintaining them.
“The first idea about the scheme is that it offers data sovereignty. Apart from data sovereignty being enhanced with a Nigerian card, we would not have to scramble all over the place searching for dollars to settle foreign card companies.”
Fasua added that the card would also help some decisions of the monetary policy committee of the CBN and some policies of the federal government.
He further said, “This domestic card therefore will help with some of the current policies on monetary policy, such as the currency redesign and cashless policy. Our society must change, and we must lumber less and less cash around. We know that criminals, kidnappers, bandits, and corrupt folks in public and private sectors like to use only cash.
“These cards could also be issued for government schemes, for example if the government wants to help people financially they needn’t chase people around with cash which is usually unaccounted for. It will be hard to convince the foreign companies that help issue cards here to modify cards for that purpose.”
Citing examples on what other foreign countries have done with the Domestic Card Scheme, Fasua notes that Nigeria can also tap from the potential to transform its financial services system.
He said, “China and India have successful domestic cards which are crowding out Visa and Mastercard
“The Rupay (India) which was started in the year 2012 now does over $30 billion in yearly transaction turnover.
“UnionPay ranked first by number of cards in circulation worldwide as at the end of 2021 with 9.4bn, compared with Visa at 3.7bn and Mastercard 2.5bn. Though information is scarce around China, the UnionPay card did a transaction of $7.5trn in 2015 alone. Transactions are propelled by the rising middle class in China,”
Fasua, therefore, urged the federal government and other stakeholders to support the initiative so as to achieve its target and compete globally.
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