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Business News of Monday, 2 January 2023


Banks’ quest for contactless payment enters new phase

File photo to illustrate the story File photo to illustrate the story

For over 10 years, Oseni Abdul, an Abuja-based entrepreneur spends nearly five hours weekly in banking halls either making deposits or settling other obligations to her customers.

During one of such visits to a bank in Central Business District, Abuja, a teller who has been watching her activities in the bank for years, decided to tell her about a digital payment code, the Nigeria Quick Response (NQR).

“You can make payments to your suppliers and receive funds from your customers anywhere using NQR you are without coming to the banking hall,” the cashier told Abdul.

The teller further educated him about the NQR code, an indigenous payment platform designed by the Nigeria Interbank Settlement System (NIBSS), in collaboration with commercial banks, to provide reliable and enhanced payment experience for customers and merchants.

Abdul later narrated that the teller’s advice cut his visits to banking halls by over 70 per cent, saving him time, which he channelled into growing her textile business.

“Adopting the NQR code saves time and money. I will tell more market women the convenience and efficiency the code brings to e-payment,” Adbdul promised.

NIBSS data showed that over 78 per cent of banking transactions in Nigeria are conducted using mobile devices, with younger generation leading in instant payment adoption. The value of these transactions per quarter has averaged N1.2 trillion as more merchants and other bank customers embraced NQR code.

Central Bank of Nigeria (CBN) Director, Payment System Management, Musa Jimoh, had, during the launch of the code in Lagos, said the new ‘touch-free’ payment option eliminates direct contact between merchants and their customers.

He advised that the NQR code should be adopted by banks as it facilitates payment by simply scanning generated digital code for payment.

“The innovative solution is boosting financial inclusion while providing access to faster, easier and secure financial services to Nigerians. It provides a “touch-free” option of receiving and making payments for goods and services by simply scanning to pay,” he said.

Jimoh explained that as consumers and merchants alike move towards technology-driven solutions, NQR Codes are growing increasingly important. Nigeria demonstrates yet again that it has a forward-looking financial services industry, as it drives towards a truly cashless and contactless society with NQR.

He said the payment solution was designed to be “low cost” for merchants and would require shoppers to scan a QR code generated by a seller to pay for an item. Each code will have unique details containing the information relating to the transaction and would link with a customer’s Banking App, already enabled on their smartphone.

According to NIBSS, the NQR is transforming the way Nigerians choose to pay for goods and services and offering instant value to business owners.

Many banks are adopting NQR code for the benefit of their customers and merchants.

Other stakeholders described the introduction of NQR as strategic, timely and aligns with the CBN’s cashless economy goal.

For them, it also shows that digital payment is aligning with global standards noting that his bank has been on the forefront of the QR digital payment solution in Nigeria.

They believes there are opportunities for micro small and medium enterprises to promote their products through digital platforms.

For them, the deployment of NQR is helming it to grow its retail business, deepen digital financial inclusion, and lower transaction cost for customers. They said merchants that require efficient but cheap payment solutions due to their relatively small profit margins were embracing NQR code.