e-business
Nigeria needs to move faster in order to compete favourably with other nations in e-business. SAMSON ECHENIM writes on the peculiar challenges of achieving a cashless economy.
A London-based medical practitioner, Dr. Tokunbo Ajayi,was in Lagos three months ago, on a two weeks vacation. It was his first visit to Nigeria after spending a total of 15 years in Belgium and England.
He had requested his uncle to send a car to his Magodo home to enable him drive around town to see a few places.
First, he called at a filling station for fuel. Having filled the tank, he handed out a credit card. The petrol attendant looked aghast and said, ”Oga, what is that? Your money is N3,000.”
Obviously surprised at the man‘s response, Ajayi yelled back, ”I don‘t contest that. Take the card, make the deduction and return my card.”
”Oga, we don‘t take card here. We collect cash,” said the attendant, almost shouting.
The matter degenerated into a shouting match. And it was another young man who came in a Jeep for fuel that paid for him.
Ajayi, thoroughly embarrassed by the action, had to cut short his vacation because he could not continue to depend on people for money anytime he needed to buy things.
When foreign guests, many of them coming to Nigeria for the first time, offer credit or debit cards at the reception of some Nigerian hotels, they are usually disappointed to hear that it is either pay in cash or will not be allowed to check in. They instantly come to the conclusion that they are in a different world.
There are, however, a few hotels that accept credit cards.
The Guest Service Manager of VCP Hotel in Victoria Island, Lagos, Mr. William Drew, said many Nigerian guests still prefer to make cash payments.
The hotel operates with both MasterCard and Visa card. But Drew said some electronic payment services could be ”epileptic.”
A former Minister of State for Finance, Mr. Remi Babalola, in a lecture on the imperative of a cashless economy in Nigeria, said, ”The immense benefits associated with the use of electronic payments both to the individuals and the country are not in doubt. But while tremendous progress is being made on card system in developed countries, the African continent appears to have been left significantly behind.”
Credit/debit cards are being used to discourage the habit of moving around with large cash. This prevents loss of cash to pick-pockets, armed robbers or by any other means.
Credit card is a plastic card that provides an alternative payment method to cash when making purchases or paying for services. Functionally, it can be called an electronic cheque.
Credit cards are issued by a credit card issuer, such as a bank or credit union, after an account has been approved by the credit provider, after which cardholders can use it to make purchases at merchants accepting that card.
Wikipedia.com explains that each month, the credit card user is sent a statement indicating the purchases undertaken with the card, any outstanding fees, and the total amount owed.
After receiving the statement, the cardholder may dispute any charges that he or she thinks are incorrect
Like credit cards, debit cards are used widely for telephone and Internet purchases; and unlike credit cards, the funds are transferred immediately from the bearer‘s bank account instead of having the bearer pay back the money at a later date.
Debit cards may also allow for instant withdrawal of cash, acting as the ATM card for withdrawing cash and as a check guarantee card.
According to Babalola, the inclination, in developed countries is to move more towards electronic payment than any other form of payment for convenient, fast and easy business transactions.
”For Nigeria to join this league of developed economies by 2020, e-payment must form the bedrock of all financial transactions,” he said.
While many Nigerians may not readily use cards in paying for goods over the counter, doing so for the purposes of recharging their telephones and paying for television subscriptions may be more likely.
Recently, Globacom introduced a system allowing subscribers to recharge their telephones using ATM and POS (point of sales) terminals, but whether subscribers will adopt it is another question.
The Glo‘s spokesman, Mr. Tunde Babalola, did not want to comment on it, as he did not reply an email sent to him by our correspondent.
Local cable television provider, HiTv said customers are gradually subscribing through its electronic system, called QuickTeller, which enables them to pay their charges online or through a POS terminal and ATM.
”It‘s quite encouraging that Nigerians are gradually embracing the e-payment mode, and with the drive in term of awareness, HiTV is giving an alternative mode of payment, it is gradually picking up,” the company‘s spokesman, Mr. Justin Esade, said.
The Group Head of Products and Marketing, First Bank Plc, Mrs. Ezine Obikile, said in an interview with our correspondent in Lagos that Nigeria was facing peculiar challenges on the path to embracing e-business culture.
She listed some of them as poor telecoms infrastructures, the people‘s attitude towards e-payment, susceptibility to fraud and even employee sabotage.
According to her, the Central Bank of Nigeria, in recognition of this, has deliberately introduced certain policies to promote e-payment.
She said, ”Finding merchants for POS is a challenge. That is why there is a kind of lull within the e-business in the country. The massive proliferation of terminals in advanced countries is not here. And the reasons are not farfetched. Here, we have infrastructural breakdown. POS machines need to work through some network providers and you know that infrastructure in the country is not okay. Again, a lot of merchants are not willing to acquire extra cost.
”The telecoms services are not always available. GPRS is not always available. Services from VSAT are more reliable and have better uptime and network link, but there is a general apathy in the adoption of technology.
”The sales people too are hindering the use of POS, because they are used to tips. If you pay with your card, it is the exact cost of the service that you remove from their account. So sometimes, even when the terminals are working, some sales people will hide them and tell customers that they are not available. So it is a combination of issues.”
Although she said the level of e-transaction in the country has risen in the past two years, she noted that a lot of cases were reported in fraud.
She noted, “A cashless economy is becoming so germane, particularly now that armed robbers are regular visitors at places like filling stations, hotels and super markets.”.
Source:Punch
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