CBN moves to enhance transparency in banking sector

CBN moves to enhance transparency in banking sector
The Central Bank of Nigeria has directed banks and payment service providers to separate all transactions that would typically be categorised as bulk payment upon transition.

The CBN said in a circular on Wednesday that the directive was aimed at facilitating seamless auditing and boosting transparency in the banking system.

The circular, which was addressed to all banks and PSPs, was dated September 9 and signed by the Director, Payments System Management Department, Musa Jimoh.

The statement, titled ‘Disaggregation of bulk payments’, said, “The Central Bank of Nigeria has noticed the inherent problems associated with the processing of bulk transfers by banks and payment service providers.

“Currently, originating banks and PSPs pass a single debit entry through 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.

“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.”

The apex bank implored banks and PSPs to ensure full compliance with the directive and other payment system regulations.

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