Banks and Payment Service Providers (PSPs) have been directed by the Central Bank of Nigeria (CBN), to commence processing of end-to-end bulk payments or transfers on their platforms.
In a circular to the banks and the PSPs yesterday titled: “Disaggregation of Bulk Payments,” the CBN also directed banks to retain breakdown of the accounts that receive the credits in the custody of the sender’s bank.
The bulk payment system currently in operation at banks and other payment providers hampers transparency and audit trail, the apex bank said.
The originating bank or PSP, in the current bulk payment system, passes a single debit entry through the initiating customer’s account and multiple credits to the beneficiary’s account.
Signed by Director, Payments System Management Department, CBN, Musa Jimoh, the circular stated that the CBN gave the directive because it noticed the inherent problems associated with the processing of bulk transfers by banks and PSPs which include distorting audit trail and transparency.
The CBN has noticed the inherent problems associated with the processing of bulk transfers by banks and payment service providers (PSPs).
Currently, originating banks and PSPs pass a single debit entry through the initiating customer’s account and multiple credits to beneficiaries without adequate records of the credit entries in their system. This distorts the audit trail and hampers transparency.
In order to address this challenge, the CBN hereby directs that all end-to-end bulk payments or transfers shall henceforth be processed on the platforms of banks or PSPs for their customers with a detailed breakdown of the accounts that receive the credits retained in the custody of the sender’s bank. “All banks and PSPs are required to ensure full compliance with this requirement and all other payment system regulations.”