What’s the news? The Central Bank of Nigeria (CBN) has directed banks and payment service providers (PSPs), via a circular, to begin processing end-to-end bulk payments or transfers on their platforms and to track accounts that receive credits in the custody of the sender’s bank.
How were things done before? Originating banks and PSPs passed a debit entry through the initiating customer’s account and multiple credits to beneficiaries without keeping adequate records of the credit entries in their system. This, reportedly, altered the audit trail and reduced transparency.
But with the new method, all end-to-end bulk payments or transfers for customers are processed on the platforms of banks or PSPs, with a detailed breakdown of the accounts that receive the credits held in the sender’s bank’s custody.
The payment technique currently used by banks and other payment providers, according to CBN, inhibits transparency and alters the audit trail. Continue reading