MIGRATION TO CHIP, PIN CARD TECH REDUCES FEAR OF FRAUD IN CASHLESS SOCIETY - UMEANO

By Prince Osuagwu
As CBN's cashless society initiative continues to generate fears over poor authentication status and porous security system, the CBN, through its Head of Shared Services, Mr Chidi Umeano, in this interview, said that majority of such fears were taken care of when Nigeria made the giant stride in migrating all its card schemes from magstripe card technology to Chip and Pin based technology.

In the wake of CBN's decision to implement cashless society system, a lot of concerns have been expressed over poor awareness and authentication status. Do you think we can go ahead, notwithstanding?

Well, people have said that to me and it is understandable because we are trying to change culture and there is always the usual resistance to change. We are also not unmindful that in terms of infrastructure, we have not achieved100 percent. But the question is, do we just wait and do nothing? Do we wait until we finish solving the problem of infrastructure?.

In terms of awareness on this policy, it is still a continuous exercise. Don't also forget that we are using Cash-lite Lagos as a test case. Because we know that if we succeed in Lagos, we will succeed in any part of this country. So most of the things we have done is actually concentrated in Lagos. Most of the TV and media advertisements have always be in Lagos. I think we have actually done a lot in terms of awareness creation.

First of all, we started with what we called Stakeholder Engagement Sessions, SES. This is where we meet recognized associations, professional bodies, religious bodies and we actually talk with them, discuss and present to them what we want to do, just to come up with certain positions and decisions. We have also engaged in grassroot sensitization where we have the Electronic Payment Providers Association of Nigeria, EEPAN as consultants.

They engage market women and all that sort of people, they do demos of the system to them to drive the point home. We also have a consultant that is involved in mass media campaign, where we have to put a lot of slot on TV, radio etc. I'm sure we will continue to do this so that the policy can pick up fast. It has to do with people understanding and as time goes on, it will continue to catch on.

Chidi Umeano, Head Shared Services, CBN
Another area that seems to be attracting serious public concern is that of POS and other infrastructure deployment. People feel that those going to implement this policy are not doing anything to train users, merchants on the usage. Again, considering the vulnerability of the cashless system, it seems to be a genuine fear that fraudsters can take advantage of the system. Is CBN doing anything to address that?

Let me point out that the deployment of POS is not an initiative from central bank. It is actually an industry initiative. We work with bankers committee, made up of CBN, banks and other financial institutions. However, in terms of deployment of any of  these  infrastructure and make them run successfully, every hand is on the deck. As we speak today, POS that was barely 2, 000 to 3,000 at the beginning of this year, is now over 100,000 deployed.

You can say that a lot of them have not started operating but the good thing is that they are out there. We also have a policy to ensure that they work well. We have what is called the Payment Terminal Service Providers, PTSPs. These are carefully chosen licensed companies that deliver, deploy and maintain and train merchants for the use of the point of sales terminals. We understand that the merchants may not know how to use them or educate users, so what we did was to assign people who go round on daily basis to educate the merchants and ensure that the infrastructure are working well.

In terms of security, everybody is worried and it is a genuine worry. Hackers, miscreants and all that can infiltrate the system, but Nigeria has done what is very marvelous with the migration of all card schemes in this country from magstripe card technology to Chip and pin cards.

By that singular act, frauds have been able to reduce by over 90 percent. We also have the fraud forum which focus is to track fraud in the industry. Today things have been put in place in the banking sector that ensures that if one fraud happens in one banks, it sends signals to other banks to avoid repetition. These are initiatives being put in place to ensure that the issue of security is tackled. Even from the banks, in terms of managing customer expectations, every bank now has a help desk, in keeping to the cashless initiative.

Also, Central bank has gone further to put in place a new  need department with a Director, just to handle customer problems including advocacy, education and all that. It is called consumer protection department. This is just to let you know that we are taking the issue of security very seriously because it is very critical to us.

Now, EPPAN, one of your consultants is holding the E-PAYMENT FOR GOVERNMENT SUMMIT in Abuja July 10, which you are in support of, what do you think this forum will achieve?

Well, it is a further enlightenment campaign, particularly to the government. You have reminded me here at the beginning of the interview that people are worried that we have not created enough awareness on this cashless thing. So anything that can help us reach more people and express ourselves on the motives and make more people become aware, we will support.

At every fora, we have tried to sell our ideas and interact with stakeholders.  So it is not surprising that CBN is part of all this forum. It is something that is very interesting to us. We use every opportunity we have to explain to people what the policy is all about. What EPPAN  is trying to doget the MDAs to start migrating their thinking, actions towards cashless system because it is very critical. We think that with the experience of EPPAN over the years in this business, we will achieve the target of the forum

Do you think the few days summit is enough?
It may not be enough, we just started. We will keep building on it. If we do this one successfully, then we can begin to arrange others. It is something that has just started, I'm sure that people need to understand what it is about and our position on the policy.

Judging from the Lagos cashlite pilot system, how can you rate peoples' acceptance to this cashless thing?

Oh! Of course, it is fast becoming the in-thing. Everyone is talking about cashless now. Every day, I get a lot of positive reports and we are happy, You know, cashless economy is a  whole gamut of process, from mobile payment to movement of money from one POS to another. There are a lot of products that are very good that we have. What people should do is to ask their banks exactly what is  the best products and service they may need.