16) The Impact of e-Payments on Bill Payment and Direct Debit

Report
Payment System Vision
2020
International Payments Conference
Abuja 2013
PSV Initiatives – Breakout Session
Bill Payment and Direct Debit
1
Payment System Vision 2020
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AGENDA
Background to Initiative
Stakeholders
Synergy with FSS2020
Synergy with Other Initiatives
Current Status
Next Steps
Q & A and Discussions
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Background to the Initiative
Payment System Vision 2020
Summary of the proposed Initiative
 To drive to conclusion the current initiative for Bill Payment by building on
the significant improvements to Direct Debit programs by increasing usage
of Bill Payment programs across key industry segments - Insurance,
Pensions, Telecommunications, Cable TV and Utilities.
 To encourage the development and deployment of technology to
automate the process of bill presentment / payment and thus streamline
the bill payment process in Nigeria.
Rationale
 The current initiative has been successful in implementing a more robust
offering for direct debits.
 Regulatory framework has been established for all stakeholders
 It is important to realise the commercial success by a program of deployment
of bill payment solutions and public awareness of direct debit as a payment
method.
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Payment System Vision 2020
Background to the Initiative
Objectives
 Resolve mandate activation issues with banks.
 Resolve issues related to banks insisting on confirming each debit
request received.
 Eliminate delays in upload/update of mandates by banks
 Grow usage through aggressive sensitization and publicity of
benefits of automation of bill payment processes.
 Encourage billers to institute incentives to drive adoption of DD.
 Ultimately leverage the developments under the various financial
inclusion initiatives for adoption of this means of payment by the
hitherto unbanked for settlement of bills.
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Payment System Vision 2020
Stakeholders
S/NO
BANKING INDUSTRY
USER COMMUNITY
SERVICE PROVIDERS
1
All Deposit Money
Banks
Telecommunication Companies
/ ISPs / Data Service
Organizations
NIBSS
2
Insurance Companies
E-tranzact
3
Water and Waste Management
Boards of State Governments
Interswitch
4
Power and Postal Services
Systemspecs
5
Pensions and Investment
Funds
Others
6
Cable / Satellite TV Service
Providers
7
Mortgage Institutions
8
Professional Organizations
9
Cooperatives
10
Clubs and Associations
5
Synergy With FSS2020
Payment System Vision 2020
The synergy between this initiative and FSS2020 is viewed from two perspectives.
1. Overall Work Streams:
Identified FSS Work Streams are Financial markets, Insurance, Mortgages and
Credit(Micro/SME).
FSS20202 Work stream
Financial Markets
level of synergy
Low
Rationale and approach to leverage synergy
This market segment deal in medium and long term funds
mobilization. Direct debit deals more in the retail and consumer
segments.
Improved efficiency in management of reoccurring premium
payments, thus elimination of gaps in insurance cover periods.
Insurance
High
Mortgages
High
Improved efficiency in management of reoccurring mortgage
payments, thus eliminating manual payment processes.
Credit(Micro/SME)
High
Improved efficiency in management of micro credits.
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Synergy With FSS2020
Payment System Vision 2020
2. Identifies very clearly with the 3(three) common themes of the FSS2020.
Improved adoption of DD will promote payment system efficiency and credit culture in
the system. Billers will experience improved cash flow management due to greater
predictability.
FSS20202 Theme
Deepening
level of support
High
Rationale and approach to support the theme
Direct debit adoption will foster improvement in the payment
system and promote efficiency. It will also positively impact
the function of credit bureau from a consumer and retail
credit point of view.
Economic Growth
High
Increased velocity in flow of money due to quicker access to
value and reduced drag in revenue generation from financial
assets.
International
Medium
Promote international recognition of Nigeria's Payment
System.
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Synergy With Other Initiatives
3. Direct debit aligns with other initiatives being promoted across the country in varying
ways. See table below.
Payment System Vision 2020
Initiative
Financial Inclusion
Level of Synergy
Medium
Rationale and approach to leverage synergy
DD can be and should be applicable to wallet accounts as well. it
will leverage the development of mobile money and improve
access to services in a convenient and efficient manner to the
hitherto unbanked.
National ID
Medium
The National ID Scheme should address some of the challenges
around KYC thus promote access to the financial system
(virtual/real accounts).
Digital Inclusion
High
Supports digitalization effort by encouraging non-cash
transactions and improving the experience of users of services.
WAMZ/ECOWAS
N/A
No strong synergies at this time.
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Current Status
Payment System Vision 2020
Sensitization and awareness effort has kick-started following implementation of action
steps agreed by the Work Group:
1.
Direct engagement with identified Industry Segments to drive adoption of Direct debit
for collection of subscriptions. The following segments were identified for this purpose:
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Professional Organizations
Cooperative societies
Insurance Companies
Telecommunication companies
Pensions
Mortgage Institutions
Clubs and Associations.
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Payment Systems Vision 2020
Aug 2013
CURRENT STATUS
Payment System Vision 2020
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Sensitization letters have been dispatched to 25 organizations as follows:
Professional Associations
17
Labor Unions
1
Social Clubs
7
2. There is infrastructure available in the market for full automation of direct debit
processing.
NEXT STEPS
1. Publish the FAQ in appropriate media to reinforce the message on adoption of this
channel.
Payment System Vision 2020
2. Continue direct engagement effort to grow use. Hold enlightenment sessions and work
with players to resolve emerging issues.
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3. Monitor progress and celebrate success through recognition of top users of this channel.
Views and suggestions on way forward are welcome
Questions and Discussion
Payment System Vision 2020
 Q&A
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