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The Central Bank of Nigeria (CBN) the Bank in the exercise of its powers under the CBN Act, 2007, hereby issues the Regulation on Electronic Payments and Collections for Public and Private Sectors in Nigeria (the Regulation).
The Regulation is a revision of the Guidelines on Electronic Payment of Salaries, Pensions, Suppliers and Taxes in Nigeria (2014), and is intended to guide the end-to-end electronic payment of salaries, pensions and other remittances, suppliers and revenue collections in Nigeria.
The objective of the Regulation is to fully align with the core objectives of the National Payments System Vision 2020 (PSV2020) to ensure the availability of safe, effective and efficient mechanisms for conveniently making and receiving all types of payments from any location and at any time, through multiple electronic channels. This will reduce the time and costs of transactions, minimise leakages in revenue receipts and at the same time provide reliable audit trails, thereby ensuring that the Nigerian Payments System aligns with international best practices.
This Regulation is therefore set out to provide all stakeholders with the operational procedures that guide end-to-end electronic payment for the Public and Private Sector.
This Regulation applies to all CBN regulated entities operating in Nigeria and mandates adoption, implementation and compliance with the directives on end-to-end electronic payments of all forms of salaries, pensions & other remittances, suppliers, revenue collections including but not limited to taxes, levies, penalties, recoveries, assessments, and the disbursement of funds for social programs payments bills, honorarium, scholarships, allowances, etc. herein referred to collectively as 'payments and collections'
The CBN regulated stakeholders refer to all financial institutions, Payments Service Providers and other entities licensed and regulated by the CBN which includes, but not limited to the following:
4.2.1. Deposit Money Banks (DMBs), Other Financial Institutions (OFIs) and Mobile Money Operators (MMOs)
DMBs, OFIs and MMOs shall -
iii. Salaries/pension/suppliers/tax payment transactions value per payment method given below;
iii.Salaries/pension/suppliers/tax payment transactions value per payment method given below;
5.1. Any DMB, OFI or MMO that fails to discharge the responsibilities under Section 4.2.1 as detailed in 'Schedule 1' of this Regulation shall be penalised as provided in the Schedule.
5.2. Any PSSP that fails to discharge the responsibilities under Section 4.2.2 as detailed in 'Schedule 2' of this Regulation shall be penalised as provided in the Schedule.
This section refers to all other stakeholders which are not regulated by the CBN. They include, but are not limited to the following:
In this Regulation, Beneficiaries shall include the following:
6.2.1 Employees and Pensioners
All Employees and Pensioners shall (as applicable) -
6.2.3. Taxes, Levies, Dues (& other revenue) Collecting Organizations
All Taxes, statutory levies, receipts, assessments, penalties and dues collecting organisations shall:
6.2.4. Pension Fund Administrators (PFAs) and Pension Fund Custodians (PFCs)
Any dispute, controversy or claim arising out of or relating to this Regulation or the breach, termination or invalidity thereof shall be settled in accordance with the CBN's dispute resolution mechanism and if unresolved may be referred for arbitration in accordance with the rules for arbitration of the Regional Centre for International Commercial Arbitration, Lagos, Nigeria.
Further to the implementation of the Guideline on end-to-end electronic payment of salaries, pensions, suppliers and taxes by all public and private sector organisations as directed in the CBN Guidelines referenced [CBN/BPS/PSV/GEN/014/05], DMBs are to dishonour payment instructions for all forms of salaries, pensions, suppliers and taxes not transmitted on a CBN approved straight-through electronic payment and collection platform issued by organisations with more than 20 employees.
This means payment instructions and associated schedules are no longer to be transmitted to DMBs through unsecured channels, such as paper-based mandates, flash drives, compact discs (CDs), email attachments, etc. by qualifying public and private sector organisations.
In this Regulation, the terms below shall have the following meaning:
Bank Assist - payments made by public & private organisations by providing payment schedules in an electronic format to the paying bank to upload and process payments to employees or other beneficiaries on their behalf.
Beneficiaries - recipients of funds paid using a CBN approved platform.
BVN watch-list - a database of bank customers identified by their BVNs, who have been involved in confirmed fraudulent activities.
Cheques - payments made by public & private organisations by issuing their account cheques to employees or other beneficiaries.
DMB - Deposit Money Bank.
End-to-end - payments made by public & private organisations using an electronic platform that transmits instructions to debit payer account and credit a beneficiary account or electronic wallet without manual intervention.
End-to-End Electronic Payment - the seamless electronic processing of all forms of salaries, pensions and other remittances, suppliers and revenue collections on a CBN approved electronic platform which transmits the instruction to debit a payer account and credit a beneficiary account or any other electronic channels without depending on any third party, manual or semi-manual means.
KYC - Know Your Customer
Manual - payments made by public & private organisations by providing written instructions & schedules to the paying bank to process payments on behalf of the payer.
Payer - the party instructing the payment of funds using a CBN approved payment platform.
PSSP - organisations licensed by the CBN to provide technical or technology infrastructure, software solutions or services for facilitating end-to-end electronic payment to financial institutions or their customers.
Private Sector - Organisations/Business entities not managed or operated by government
Public Sector - Ministries, Departments and Agencies of Government at Federal, State and Local Government levels
RTGS - Real Time Gross Settlement System
Suppliers - include contractors or vendors whether organisations or individuals offering goods or services in exchange for payment
Stakeholders - all participants in an end to end electronic payment including public and private sector organisations, employees, pensioners, suppliers and taxpayers.
CBN Regulated stakeholders - participants licensed by the CBN to provide payment services.
TIN - Tax Identification Number.
This Regulation shall take effect from the date of its issuance by the CBN.