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CBN Directs Banks To Break Down Bulk Payments Initiated On Platform

The Central Bank of Nigeria has directed Banks and Payment Service Providers to commence process of end-to-end bulk payments or transfers on their platforms.

In a circular dated September 8, Deposit Money Banks and PSPs were directed to provide detailed breakdown of the accounts that receive the credits retained in the custody of the sender’s banks.

The circular titled, ‘”Disaggregation of Bulk Payments,’ was signed by the Director, Payments System Management Department of the CBN, Musa Jimoh.

“In order to address this challenge, the CBN hereby directs that all end-to-end bulk payments or transfers shall henceforth be processed on the platforms of banks or PSPs for their customers with a detailed breakdown of the accounts that receive the credits retained in the custody of the sender’s banks,” said CBN.

This is part of the apx bank’s effort to curb the distortions in bulk transfers when banks and PSPs transactions are processed using a single debit entry through the initiating customer’s account and multiple credits to beneficiaries without adequate records of the credit entries in their system.

The regulator said the mode of carrying the transactions perverts audit trail and frustates transparency.

This means that fintech payment platforms like Interswitch WebPAY, Paystack, Flutterwave, eTranzact, Remita and Opay and DMBs would separate all the transactions it categorised as bulk payment upon transition.

The circular stated, “The Central Bank of Nigeria (CBN) has noticed the inherent problems associated with the processing of bulk transfers by banks and payment service providers (PSPs).

” Currently, originating banks and PSPs pass a single debit entry through the initiating customer’s account and multiple credits to beneficiaries without adequate records of the credit entries in their system. This distorts the audit trail and hampers transparency.”

The CBN emphasised that banks and PSPs are mandated to ensure full compliance with the new requirement and all other payment system regulations.

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