Renowned accounting lecturer at the Ladoke Akintola University of Technology (LAUTECH), Ogbomoso, and manager of funds, Professor Morufu Oladehinde Oladejo he reiterated the fact that payment system is central to business, commerce and governance, and has the tendency to optimize gains in business.
Delivering the 72nd Inaugural Lecture of the University, titled: “Dynamics of Accounting and Payment System (DAPS): The Hopes, The Fears and Aspirations”, he urged that it should therefore be taken seriously by players in industry and public sector.
He argued that the Payment system has undergone tremendous changes from the day of creation, expansion in business and economic activities, barter trading, traditional payment system, digital transformation age, cryptocurrency and central bank digital currency system.
He noted that there has been growth in digital payment usages and reduction in cash-based and paper money transactions over the year due to surge in internet usages.
According to him, Digital payment has a tendency to significantly reduce currency in circulation and cost of printing currency notes.
He explained that ranking of Nigeria among the 66 countries with growing digital payment platforms has demonstrated the fact that Nigeria is transforming from cash-based towards cashless but still cashlite economy.
Oladejo explained that Mobile technology has been identified as a key driver of Nigeria’s financial transformation, enabling millions of people to access digital banking and payment services with ease “As mobile wallets, fintech platforms, and digital banking continue to gain attention, Nigeria is seen to be positioning itself as a global leader in the transition towards a cashless economy.
He noted that even when Digital payment has not altered double entry principles of accounting, it has improved financial reporting procedure in both private and public sectors.
He explained that payment dynamics have faced some solvable challenges that have made for light at the end of the tunnel.
His recommendations to the Government includes the need for Increased investments in digital infrastructure, such as improving internet connectivity and power supply, are essential.
He also called on the Government to prioritize the development of a robust digital infrastructure to support the growth of electronic payment systems.
“He also observed that reducing transaction fees and providing subsidies for e-payment adoption can serve as incentives to most of the organizations especially SMEs at embracing payment technologies.
Oladejo urged the Federal Government to require federal and state Ministries, Departments and Agencies (MDAs) to accept and process financial transactions using eNaira platform, while also integrating eNaira into pension and insurance platforms.
He canvassed the Central Bank of Nigeria (CBN) to mandate other commercial banks to incentivize and onboard their merchants to accept eNaira.
These institutional supports, he said will increase public trust about the digital currency and also signal seriousness by the authorities.
He urged the Government to establish regulatory frameworks to ensure the security and reliability of e-payment platforms, addressing concerns about fraud and data breaches. A federal framework for payments regulation could support responsible innovation in payments by establishing appropriate federal oversight of non-bank companies that are involved in the issuance, custody, or transfer of money or money-like assets”.
Oladeji canvassed that efforts should be made across jurisdictions to align regulatory, supervisory and oversight frame-works for cross-border payments and harmonizing data and market practices for cross- border payments.
He called on the Government to continue its outreach efforts to consumers, businesses, and financial institutions, with a focus on inclusion of underserved communities. International engagement should also continue.
On promoting CBDC and eNaira usages, Oladejo explained that CBN in collaboration with the government should expand the practical applicability of eNaira by using it as a means of payment for youth empowerment, student loan and staff loan among other social programs. This will promote the youths’ interaction with the eNaira platform so that they will be more familiar with its benefits and applicability.
He solicited that CBN should partner with fintech merchants to offer cashbacks or discount exclusively for eNaira usage, saying this will promote the value of eNaira in the eyes of the citizen thereby accelerating the adoption rate regardless of its complexity.
To Financial Institutions and Technology Providers
Financial institutions and technology providers should collaborate to design cost effective e-payment solutions tailored to the needs of all organizations instead of unhealthy rivalry to be the fintech leaders.
“They should engage in capacity building, training and retraining staff digital technologies continue to advance.
“The General Public should see digital payments as new normal across the globe as failure to integrate them will be disadvantageous and erode global connect.
He concluded that the tradition of holdcash tendency should gradually be disengaged for better financial transactions.
