The Central Bank of Nigeria (CBN) has directed Deposit Money Banks (DMBs) to dishonour instructions on the payment of salaries, pensions, and taxes of public and private companies that are not transmitted on approved electronic payment and collection platforms.
Also, the apex bank has mandated the banks to render a monthly statement of payments of such public and private entities.
The directive was contained in the revised Regulation on Electronic Payments and Collections for Public and Private Sectors in Nigeria which the CBN released on its website yesterday.
In it, the CBN said that “further to the implementation of the guideline on end-to-end electronic payment of salaries, pensions, suppliers and taxes by all public and private sector organisations as directed in the CBN Guidelines referenced [CBN/BPS/PSV/GEN/014/05], DMBs are to dishonour payment instructions for all forms of salaries, pensions, suppliers and taxes not transmitted on a CBN approved straight through electronic payment and collection platform issued by organisations with more than 20 employees.
“This means payment instructions and associated schedules are no longer to be transmitted to DMBs through unsecured channels, such as paper-based mandates, flash drives, compact discs (CDs), email attachments, etc by qualifying public and private sector organisations.”
The regulation is a revision of the Guidelines on Electronic Payment of Salaries, Pensions, Suppliers and Taxes in Nigeria (2014) and is intended to guide the end-to-end electronic payment of salaries, pensions and other remittances, suppliers and revenue collections in Nigeria.
The CBN said that the objective of the “regulation is to fully align with the core objectives of the National Payments System Vision 2020 (PSV2020) to ensure the availability of safe, effective and efficient mechanisms for conveniently making and receiving all types of payments from any location and at any time, through multiple electronic channels.”
This, the apex bank added would reduce the time and costs of transactions, minimise leakages in revenue receipts as well as provide reliable audit trails, thereby ensuring that the Nigerian Payments System aligns with international best practices.
According to the guideline, providing e-payment system solution or services without obtaining a licence from the CBN will lead to the withdrawal of the vital document to operate as a PSSP for a minimum of one year from the date infraction is detected as well as report the defaulting PSSP to the appropriate law enforcement agency
It further stated that non-return of unapplied funds within stipulated timelines shall attract a penalty of N1,000 for every transaction as well as N1,000 for every transaction delayed.
Non-provision of quarterly report on end-to-end e-payment of salaries, pensions, suppliers and taxes to the CBN or submission of false or inaccurate reports shall attract N5,000 penalty for each day for which the report is not provided to the CBN and a penalty of N50,000 and a warning letter to the managing director to the affected outfit.
There will also be suspension of licence/approval after three consecutive repeated occurrences of either infraction (a) or (b) above until reports are made available to the CBN.