33 banks, U.S. firm launch e-payment project
From Mathias Okwe, Abuja
NIGERIA inched closer to a cash-less economy yesterday with the formal launching of a partnership by two renowned global electronic payment companies, ValuCard Nigeria Plc and the United States of America-based Visa International.
ValuCard is owned by 33 Nigerian financial institutions.
The American company is injecting about $2.8 million into the project expected to facilitate more electronic-based payments and significantly enhance economic growth and fiscal transparency.
At the ceremony yesterday in Abuja, the Federal Government described the investment by the American company as a sign of increasing global confidence in the Nigerian economy.
The U.S firm's $2.8 million represents about 15 per cent of ValuCard's equity in the project.
The partnership between the two companies will allow both organisations to develop electronic payments and the card market in Nigeria, bringing to the economy the significant benefits of a cash-less society.
The alliance strengthens ValuCard's position in the Nigerian market as a leading electronic payment company. The over 40 banks issuing the ValuCard today are the most significant in the country and account for over 90 per cent of banking activities in Nigeria in terms of assets and capital deployed.
Visa International CEMEA (Central and Eastern Europe, Middle East and Africa) which has taken a minority shareholding in ValuCard will be deploying its e-payment technology platform and a range of products to improve the efficiency of financial transactions.
Visa will also provide the personnel to assist in ValuCard's operations, including installation of world-class processes in the areas of risk management, transaction processing and card personalisation.
Speaking at the launch yesterday, Ms. Anne Cobb, the president of Visa International, CEMEA, said the strategic alliance would facilitate the infrastructure and necessary expertise required to introduce Visa products and services into Nigeria.
She said: "The development of a world-class electronic payment and card system in Nigeria will have numerous benefits for the government, business and the people of the country. Research around the world has shown that when a country moves from mainly cash-based economy to an electronic payment-based economy, there is a dramatic improvement in financial transparency, savings and investment, economic growth and government efficiency.
All of these serve to improve a country's international standing and credit rating," Cobb stressed.
Mr. Kyari Bukar, the managing director and chief executive officer of ValuCard, explained that Visa was chosen as partner because it was the world's leader in electronic payments, and it has the expertise and technology that required to achieve the objectives of developing the economy in Nigeria by promoting an electronic payments culture.
He said since inception in 1999, over N31 billion worth of payment transaction had been carried out while, today, there are over 250,000 ValuCard holders in circulation, generating an average weekly transaction value of over N1 billion.
The Senior Special Assistant to the President on Budget Monitoring and Price Intelligence Unit (BMPIU), Oby Ezekwesili, explained that the global confidence in Nigeria was buoyed by the excellent economic principles of the current administration.
Her words: "This development is an indication that something good is happening. They didn't come three years ago, they didn't come last year. You probably decided to come now. Somebody should be asking: Why? Because at every point in time in the boardrooms of organisations, they make decisions not based on sentiments but on the confidence level they have in the political risk analysis on the basis of competitiveness of the environment to which they are heading and a lot of other things that has to do with bottom line profit maximisation "
She continue: "So certainly, Visa International looked at Nigeria and suddenly found that the vulnerability level of doing business has reduced significantly at this time. That's why it decided to enter into the Nigerian market. So it is in a way an expression of confidence in the real economic management that is going on in this nation."
The presidential aide, while challenging the investors to tap from the great potentials of the large Nigerian market, also asked them to be honest in their dealings not to be talking of the business challenges alone but the gains which she said is in quantum.
She assured of the Federal Government's co-operation in terms of the provision of infrastructure to enable a robust cash-less system in Nigeria.`
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