BANKING SYSTEM IN NIGERIA – Due to increasing response of banks to e-banking in Nigeria coupled with the supervisory role of Central Bank of Nigeria led to the setting up of Technical Committee on e-banking in 2003 and also the formulation of guideline on e-banking based on the report submitted by the committee in 2003.
GUIDELINES ON E-BANKING IN NIGERIA
The guidelines put in place include the following:
- Restriction of issuance of e-money products to only licensed banks under the supervisory purview of the CBN or eligible subsidiary companies of it.
- Any bank or company intending to serve as issuer of e-money to seek and obtain prior clearance and approval of CBN.
- The bank or subsidiary company to submit a detailed feasibility report covering areas such as the scheme structure, documentation including prototype (sample card) products, clearing and settlement arrangements, security and system control, float management business plan and contingency plans i.e. disaster recovery plan and contingency system.
- The promoter of e-products to enter into contractual agreement with the Nigerian Inter Bank Settlement System (NIBSS) for the clearing and settlement of e-money products.
- The electronic banking service should be offered in Naira only. Where such a service is to be provided in foreign currency, it should be to only holders of ordinary domiciliary accounts and-conform to all other foreign exchange
Electronic Banking products and services should comply with the Money Laundering Act 1995 as amended and “Know Your Customer Rules” (KYC).
- The CBN, through its Banking Supervision Department would appraise the product or service as well as the applicant, bank’s overall financial condition and its compliance with the CBN rules and regulations based on the latest available returns and examination report on the bank.
- Banks wishing to provide transactional and /or enhance existing electronic banking services shall submit to the CBN, an application describing the services to be offered /enhanced and how it fits into the bank’s overall corporate objective and strategy.
- To disclose to the CBN and National Drug and Law Enforcement Agency (NDLEA) any single transaction, lodgment or transfer of funds in excess of N500, 000 and N2million or their equivalent for individuals and corporate bodies respectively in line with the provisions of Money Laundering Decree 1995.