CBN BANS DISCRIMINATORY E-PAYMENT SERVICES

The Central Bank of Nigeria (CBN) has banned all forms of discriminatory practices in the provision of electronic payment service. This was one of the highlights of two revised guidelines relating to e-payment services issued by the apex bank on Friday. Guidelines on Transactions Switching in Nigeria; and Guidelines on Operations of Electronic Payment Channels in Nigeria. Among other things the CBN stated, “According to the guidelines on transaction switching, “ Among other things the guidelines on transaction switching prohibited Abuse of dominant position by any operator. It stated, “No parties to Switching Services shall abuse its dominant position by directly or indirectly imposing unfair or discriminatory condition and fees in the provision of its services; Equally, no parties to Switching Services shall limit or restrict the provision of switching services or market thereof or technical or scientific development relating to switching services to the prejudice of consumers; No parties shall indulge in practice or practices resulting in denial of market access. The guidelines also banned Nigeria Interbank Settlement System (NIBSS) from competing with any e-payment service firm in the country. It stated, “Nigeria Inter-Bank Settlement System Plc (NIBSS), the Nigeria Central Switch (NCS) and any company, person or group of persons performing the roles, duties or functions of the Nigeria Central Switch SHALL NOT under any circumstance whatsoever or howsoever engage in competition with any Payment Card Industry Scheme, Operator or Service Provider. Accordingly, Nigeria Inter-Bank Settlement System Plc (NIBSS), the Nigeria Central Switch (NCS) and any company, person or group of persons performing the roles, duties or functions of the Nigeria Central Switch shall not: Be or engage in any business as: Card Scheme, Issuer of Payment Cards, Issuer-Processor, Acquirer, Acquirer-Processor.” It also banned NIBSS from supporting or promoting any card scheme as well as from owning, deploying, maintaining, installing and acquiring devices such as Point of Sale. Under the guidelines on operations of electronic payment channels in Nigeria, the CBN stated, “No card scheme shall discriminate against any ATM owner or acquirer. Every card-scheme must publish for the benefit of every ATM owner or acquirer and the Central Bank of Nigeria, the requirements for acquiring ATM transactions under the card scheme.”No ATM owner or acquirer shall discriminate against any card scheme or issuer. Stand-alone or closed ATMs are not allowed. “To achieve interoperability, all POS terminals deployed in Nigeria shall accept all transactions arising from any card issued by any Nigerian bank. Accordingly, Acquirers and other service providers shall be card neutral entities that have no reason to promote or favour any card brand over the other. “ Every acquirer must be able to accept all cards issued by Nigerian Banks, whether through a direct license or via an arrangement with any other acquirer that is licensed under the relevant card scheme/association.”