Going
cashless is a policy that the economy is now accepted as essential for the
nation’s social-economic development, however, the challenges of a successful
caused by lack of infrastructures seems to be a clog in the wheel of its
progress, in this interview with the Country Manager for West Africa,
MasterCard Worldwide,Mrs. Omokehinde Ojomuyide, insist that Nigeria does not
need a full-developed infrastructure to make cashless policy a success.
What is your focus in
Nigeria?
MasterCard
is a technology company that is focused on e-payments. So everything we do is
about moving people from cash transaction to electronic transaction. We have a
vision of a world beyond cash, and that is what we stand to achieve with our
yearly exhibitions. We do more than yearly exhibitions, as we are also involved
in interactions with government and people as well as in promos. The essence is
to educate people on the value and benefits of electronic transactions and to
let people know that cash is expensive to manage and that the best way forward
is to go cashless and embrace electronic transactions.
Specifically, what is your
contribution to electronic payment in Nigeria?
One
thing that MasterCard did about two years ago was to move fully into Nigeria
and made Nigeria the hub for sub-Sahara Africa. By that move, we are running
MasterCard operations in the whole of sub-Sahara Africa from Nigeria and the
reason behind this is because Nigeria has the population to grow our type of
business, and we also needed to develop Nigeria in the area of e-payment and we
have been doing just that to promote electronic payment in Lagos and Nigeria.
The Central Bank is driving the cashless initiative, beginning with Lagos as
pilot scheme, and we are very much in support of the initiative. Nigeria has
just realised what developed countries have realised some years back in the
area of cashless economy. We are encouraging the people of Lagos and Nigeria to
go cashless, and we are doing just that with our partners who are mainly the
financial institutions.
Apart
from our customer through which, we reach the public, we are also collaborating
with government in educating the people on the need to go cashless. We have had
several promos in support of CBN’s campaign to go cashless. We have best
practices initiatives on cashless that we are sharing with people and
governments.
What is your assessment of
CBN’s cashless initiative, concerning infrastructure?
Infrastructure
is important in driving the initiative of cashless economy, but the
infrastructure we have in Nigeria is developing. It is true that the country
has not developed its infrastructural base, but we do not need a full-developed
infrastructure before we implement the cashless policy. It is a gradual
process, which I strongly believe we will get over with time. Since the
implementation began with Lagos as the pilot state, banks have invested a great
deal in infrastructure, deploying lots of Point of Sales (PoS) terminals and
other devices that will drive cashless in the society. Merchants have also
changed their behaviour and they are accepting payments through PoS terminals.
Again,
the electric power situation has to be improved upon, to enable the devices
work. So I think there is room for growth as the awareness creation for
cashless is increasing by the day. The telecommunications operators are also
playing their part by building telecoms infrastructure that will drive the
cashless initiative. Since the whole system about cashless run on the platform
of the telecommunications operators, the CBN brought them into the scene to
provide the much needed infrastructure for the implementation of the cashless
initiative, and they are doing just that.
People are worried about
security. Do the issues of identity theft, hacking and cloning of cards bother
MasterCard?
I
quite understand that most Nigerians are still afraid of carrying out
electronic transactions and I understand what is propelling such fears. The
fears started from the days when we as a country, were using magnetic strip
cards and old technology. Then those cards could be cloned, but with the modern
technology that is in place, where we use Chip and Pin technology and the Verve
cards, it has become very difficult to clone cards or hack into encrypted card
numbers.
If
people do not compromise with their Puke Identification Number (PIN) that is on
their card, it becomes very difficult to lose money through the Automated
Teller Machine (ATM) cards. Chip and Pin technology is safe and secured and
that is what all banks in Nigeria and the world are using today.
Do you see the cashless
policy promoting accountability in governance and among people?
Cashless
policy is capable of promoting accountability in governance and within the
private sector business environment. One of the reasons for electronic payment
is the audit aspect, which completely eliminates cash, and discourages the
tendency to pilfer, since there is no cash handling. With electronic
transaction, it records the time of the transaction, the type of transaction
and the money involved in the transaction. The money is send electronically,
through the debiting and crediting of accounts, without people involved in
physical cash. For any government transaction, money is paid electronically and
it will help to promote accountability in governance.
How does MasterCard operates
in an environment where it does not issuance electronic card, yet it owns a
large chunk of it?
As
MasterCard, we do not issue cards directly to customers but we license our
partners to issue and acquire our cards worldwide. MasterCard has actually
moved beyond cards, even though we are still involved in card business. We also
do payments that are not card-based. Yes card payment has come to stay in
Nigeria, but that is not the only way to do electronic payment. There is mobile
payment, contactless payment, which enable financial transactions without the
use of cash, where technology exists.
MasterCard
is not directly involved with issuing cards because we have our licensed
partners who do that on behalf of MasterCard.
What
we do is to create infrastructure and ensure interoperability that will make
electronic transactions easy and hitch-free.
When
a bank in Nigeria for instance issues MasterCard cards, it is not their
business to ensure that the cards issued work perfectly, but it is the duty of
MasterCard to ensure that.
And
so we do just that through the interoperability system put in place in all the
Automated Teller Machines (ATMs) installed in all the 210 countries where we
have our footprint worldwide. We create the infrastructure, the standards, and
the interoperability that will enable users of our products plug into and make
better use of them.
What are your strategies operating
in a world beyond cash?
We
are working to build a world without cash, and what we do in this regard is to
make sure that our technology enhances payments from cash-base to electronic
payments. We have a MasterCard laboratory where people are researching and
creating new forms of payment system. Today we are talking about mobile
payment, contactless payment and Near Field Communications (NFC) technology
that will drive mobile payments, with mobile phones. We create a network of
people and the technology that will enhance electronic payment system.
How will electronic payment
system drive e-Commerce?
Electronic
Commerce also known as e-Commerce is the next big thing that is driving
cashless across nations. People sit in their offices, homes in Nigeria, and go
shopping online abroad. They visit different websites and do their shopping
online, make payments online using the MasterCard and the items are delivered
to them online. This is done without the person leaving the shores of the
country. Again, with e-Commerce, Nigerians can display their goods and services
to the rest of the world by taking their businesses online. People from
different states of Nigeria and from different countries of the world will get
to see the goods and services of the dealer in a particular location in
Nigeria. So it helps to promote business and advance economic development,
because many people want several things, but do not know exactly where and how
to get them. E-Commerce makes it easier for everyone to trade in different
types of businesses at the most convenient way.
What are some of the
challenges faced by MasterCard in its efforts to take countries beyond cash?
There
are several challenges, but we are surmounting them. The challenges are not
just for MasterCard, but for every institution in the financial ecosystem.
Communications is one major challenge. There is gap in data communication
between the PoS terminal and the backend. The gap creates some delays in
transaction and we need to improve on that. Power is also a major challenge in
Nigeria because the PoS terminals are power driven and without electricity,
they cannot work. Consumer education is another challenge for us. Some people
are still not excited with the cashless initiative and we are doing a lot to
educate people, to enable them see the need for electronic payment system.
What is
your MasterCard working relationship with government or regulatory authority on
the cashless initiative?
Yes
we are working with the regulator and government, but beyond that, we have
several partners we are working with in every of our locations worldwide. In
Nigeria, we are working with the Federal, State and Local governments and we are
working with the Central Bank of Nigeria, the regulator of the financial
institutions in the country.
How would you rate MasterCard
in Nigeria and internationally?
In
Nigeria MasterCard is accepted everywhere. Virtually all the banks in Nigeria
issue and use MasterCard products. We do not have any challenge on
acceptability in Nigeria, because there is a standing rule from CBN that all
financial transactions must accept MsaterCard products and virtually every bank
in the country, issues MasterCard cards for their online transactions.
Internationally, MasterCard is accepted in 410 countries, at 33 million
merchant locations.
