Written by Sarah NEGEDU

Banks need no approval for mobile wallet services-CBN

Deposit Money Banks operating in the country no longer require prior approval to offer mobile money wallet services, as the Central Bank of Nigeria now allows banks free operation of the package.

CBN in a circular to DMBs with the title, ‘Operation of mobile money wallets by DMBs,’ said the move will encourage more Nigerians to use formal financial services.

The apex bank in the circular stated that, “The Central Bank of Nigeria remains committed to deepening financial inclusion in line with its objectives to achieve the national financial inclusion target of 80 percent by 2020.

“To complement recent growth in the agent banking services under the Super Agent and SANEF initiative, and in recognition of the increasing demand for no-frills mobile money services, the CBN hereby directs that Deposit Money Banks shall henceforth not require prior approval to offer mobile money wallet services.

“DMBs are, however, expected to notify the CBN before the commencement of these services and are required to operate within the extant regulations on mobile money operations.”

The regulator has also dropped the loan to deposit ratio to 60 percent in order to ramp up growth of the Nigerian economy through investment in the real sector.

In another letter to the DMBs, titled, ‘Regulatory measures to improve lending to the real sector of the Nigerian economy’, it stated that, “All DMBs are hereby required to maintain a minimum Loan to Deposit Ratio of 60 percent by September 30, 2019. This ratio shall be subject to quarterly review.

Before now, banks maintained a loan to deposit ratio of not more than 80 percent. CBN said the directive is to encourage SMEs, retail, mortgage and consumer lending.

The circular signed by the Director of Banking Supervision, CBN, Ahmad Abdullahi, stated that “These sectors shall be assigned a weight of 150percent in computing the LDR for this purpose.”

CBN said it shall provide a framework for classification of enterprises/businesses that fall under these categories. The apex bank stated that failure to meet the minimum LDR by the specified date shall result in a levy of additional Cash Reserve Requirement equal to 50percent of the lending shortfall of the target LDR.

The CBN said it would continue to review developments in the market with a view to facilitating greater investment in the real sector of the Nigerian economy.


Latest posts

PhotoISSUP to introduce addiction prevention, treatment, policy in higher institutions

The Nigeria Society of Substance Use Prevention and Treatment Professionals, of the International Society, Substance Use Professionals, ISSUP, has [...]

21 October 2019

PhotoNigeria/Russia Relations: The Missing Link

On November 15, 1884, 14 mainly European countries gathered in Berlin for a meeting which lasted to February 26, 1885. The aim of that conference w [...]

20 October 2019