When I ran out of cash on Saturday, 26th August 2006, my consolation was that I'd stop over at the bank while coming from church on Sunday and pick up some cash from the ATM. Coming from church Sunday morning, I least expected the 'crowd' I met at the bank where I had to queue up because three other people were already there to use the ATM. Though I'd experienced such queue previously, it hadn't been on a Sunday morning. Apparently, more Nigerians are getting comfortable with electronic transactions on their bank accounts. While the ATM is presently designed to indulge our cash addiction, the import of the gradual shift towards cards and electronic transactions should not be lost on us. If you haven't noticed yet, you possibly need to pay some attention to the quiet revolution that is taking place in terms of improvements to the nation's payment.

The Cash Entrapment Is Massively Wasteful
No doubt, the proclivity to cash over the years has cost the economy monumentally. The massive investment in cash-processing and handling resources would have made plenty of impact if put into poverty alleviation programmes. The slow-down effect on economic activity is another huge element of cost. Banks can tell you how long they at times hold idle cash in vaults because the CBN is unable to receive more cash. The price in lives and resources from frequent robbery attacks attracted by cash further raises the toll. In many ways, the economy bleeds. Any shift from this very expensive habit is therefore a cheery development.

Payment Reforms Have Been Overdue
Perhaps the first major plank of the payment reform is the sustained effort by the monetary authorities to shorten the cheque clearing period. This is aimed at encouraging the increased use of cheques. A complementary measure which, unfortunately, has failed to gain front-burner attention, is the enforcement of the law on dud cheques. It's hoped that more steps will be taken by the CBN and banks to further raise the stakes in this regard.

Electronic Payment, The Real Deal And Way Forward
But the real thing now is electronic payment and purse. Small but concrete changes are definitely taking place. Firstly, the rapid spread of ATMs is a landmark development, especially with the positive interest the banking public is beginning to show. Interswitch Limited and ATM Consortium are obviously in the vanguard. Knowing that this platform is capable of delivering much more than what is currently on offer, we can only hope for the better. Shouldn't we, for instance, be able to effect transfers between accounts (irrespective of domiciliation banks)? Again, can't more merchant outlets be attracted to accept payments by deploying terminals (to eliminate cash-processing headaches, receive immediate value and reduce carrying cost including the risk of theft and robberies)?

Beyond ATMs, the Nigerian debit cards from the stable of Interswitch and marketed by various banks are gaining in usage. Though nothing to compare with the growth in telecom subscriptions, the issuance and transaction volumes have gradually grown. Today, payments can be made with these cards at POS-enabled outlets and Nigerian debit card accepting web sites. The drive now should be to expand usage off- and on-line, especially by rapidly building a larger subscriber base and expanding off- and on-line accepting merchants.

International Payment Cards Will Boost e-Commerce
With the improved financial and political profile of the country, a few good things are also happening regarding the international payment platform. Master Card, switched for by Card Technology Limited, has already commenced operation through a growing number of local banks. At last, international payment cards are now available locally. Visa International is also known to be vigourously working to launch its service and product package, with ValuCard as partner. The full import is that, with these international payment cards now available to Nigerians, the prospects of their becoming part of the online global family are getting brighter. With reputable e-payment instruments now getting into the hands of individual citizens, the day of an active online lifestyle for Nigerians appears to be drawing nearer. It does appear that gradually, the seed for a serious e-commerce era is being sown. If this really catches on, the impact on business should be significant.

Credit Cards, A Long Shot
Credit cards, which have the capacity to boost the velocity of commercial activity by expanding purchasing power, would appear, for now, to be far in coming. A number of factors of logistics are said to be responsible. Perhaps the interest already shown by the Federal Government on the matter may help to eventually finds answers and speed up our migration to that platform. For now, getting more people on the debit cards will still do a lot for the economy and should be pursued with more vigour and coordination.

However you see it, the changes in the past year or so are positive and point to a swifter, more efficient and card-friendly future for our economy. Effort should be made by all to build on this exciting development.

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