The House of Representatives has directed its Committees on Digital and Electronic Banking, Finance, Banking Regulations, and Financial Crimes to summon the Central Bank of Nigeria (CBN) Governor and Managing Directors of commercial banks. The goal is to address challenges surrounding the verifiable documentation of Point of Sale (PoS) users and report findings within four legislative weeks.
This directive follows a motion moved by Hon. John Okafor on the urgent need to implement measures to document PoS users and fund recipients for enhanced financial security in Nigeria.
Addressing Loopholes in the PoS System
Hon. Okafor highlighted several issues, including:
- Fraud Risks: The lack of verifiable identities of PoS users facilitates fraud, such as identity theft, money laundering, and unauthorised transactions.
- Transparency: Proper documentation ensures accountability by enabling transaction tracing and identifying individuals involved in illicit activities.
- Regulatory Gaps: There is a perceived lack of enforcement by regulatory bodies, which necessitates urgent intervention to protect Nigerians from criminal misuse of the PoS system.
Okafor stressed that implementing stringent identity verification aligns with both national and international financial regulations, including Anti-Money Laundering (AML) and Know Your Customer (KYC) requirements.
Proposed Benefits of PoS Documentation
- Enhanced Security: A verified identity system will reduce fraud, ensuring the safety of cashless transactions.
- Accountability: Transparency will help track illegal activities and hold operators and users accountable.
- Trust in the Financial System: Proper documentation fosters confidence among users, boosting participation in the cashless economy.
“Implementing these measures will protect consumers and businesses while meeting international financial standards,” Okafor remarked.
Next Steps
The committees have been tasked with exploring sustainable solutions to address these challenges. By engaging the CBN and financial institutions, the House aims to ensure compliance, enhance consumer protection, and bolster Nigeria’s transition to a cashless economy.
A report on the progress is expected within four legislative weeks. This initiative is a significant step in safeguarding the integrity of Nigeria’s financial system.