CBN To Kick Off Interchange Fee Regime May 2017
By Modupe Gbadeyanka
The implementation of the new interchange fee regime for operators in the payment cards industry will commence on May 1, 2017, the Central Bank of Nigeria (CBN) has declared.
The apex bank explained that the interchange fee will replace the Merchant Service Charge (MSC).
Director of Banking & Payments System Department of the CBN, Mr Dipo Fatokun, in a circular dated November 1, 2016 and signed by him, noted that by the time the new regime is effective, Merchants and Acquirers would be mandated to negotiate the MSC, while it (CBN) will control the interchange fees paid by Acquirers to the Card Issuer and other regulated service providers.
Mr Fatokun revealed that the interchange fee was introduced as a result of the limitations of the MSC regime and the objectives of the Payments System Vision 2020.
According to him, the introduction of the new pricing regime would bring about: “even greater payment card issuance and utilisation, investment in loyalty programmes and the expansion of acquirer network infrastructure across the country.”
He stated that modalities for aspects of the implementation of the new regime would be developed and communicated by the Nigeria Interbank Settlement System(NIBSS), within three months from the date of the circular .
He said to this effect, a six-month window has been given sensitisation.
“CBN hereby gives a period of six months, starting from November 2016 to stakeholders to sensitise their merchants on the changes expected, and for card schemes to reconfigure their systems to the new pricing structure.
“The interchange regime will commence live operations effective 1st May, 2017.”