The Central Bank of Nigeria (CBN) yesterday announced the introduction of a National Domestic Card Scheme which is effective January 16, 2023.
The move is aimed at promoting stability, inclusion, and growth in the financial and payment system and will be delivered through the Nigeria Inter-Bank Settlement Systems (NIBSS) Plc, which is the country’s central switch, in conjunction with the Bankers Committee and other financial ecosystem stakeholders.
The card scheme was also expected to foster innovation within the Nigerian domestic market, while enabling African and international interoperability, allowing banks and other institutions to offer a variety of solutions including debit, credit, virtual, loyalty, and tokenized cards amongst others.
Nigeria remains Africa’s largest and most vibrant economy and the pace of digitization and innovation, alongside the expansion of mobile penetration and the proactive policy initiatives of the CBN have driven the accelerated adoption of digital financial services.
Considering the strength and breadth of its banking sector and the rapid growth and transformation of its payments system over the last decade, Nigeria is ideally positioned to successfully launch a national card scheme.
Building on this platform to accelerate financial inclusion requires infrastructure that can deliver lower-cost payment services that are more accessible and affordable for Nigerians.
The central bank, in a statement issued by CBN Director, Corporate Communications, Mr. Osita Nwanisobi, pointed out that the scheme could also be leveraged as a platform for the seamless dissemination of government-to-person payments and other social impact initiatives, enhancing financial access and supporting the growth of a robust and inclusive digital economy.
The bank also said domesticating the card scheme would further enhance data sovereignty, enabling the development of locally relevant products and services and reducing demands on foreign exchange.
Nigeria joins a growing list of countries including India, Turkey, China, and Brazil as leading examples – which have launched domestic card schemes and harnessed the transformative benefits for their respective payments and financial systems, particularly for the underbanked.
Osita said, “The CBN recognizes the significant benefits from delivering Africa’s first central bank-driven, domestic card scheme, which, when delivered at scale, has the potential to become the largest in Africa, and one of the largest in the world.”