CBN incentivizes agents, mobile money operators

In line with its drive to enhance access to financial services in the country, the Central Bank of Nigeria (CBN) has said it will incentivise mobile money operators (MMOs) and Super Agents with financial support of up N500 million.

This, it explained would come under its Shared Agent Network Expansion Facility (SANEF).

The Central Bank of Nigeria disclosed this in a document on the SANEF Framework that was posted on its website yesterday.

The facility was introduced through a collaboration between the CBN and commercial banks and would have an interest rate of five per cent per annum, a maximum tenor of 10 years and is to be disbursed in tranches.

This, is however subject to satisfactory performance by the MMO or super agents.

SANEF provides financing to CBN-licenced Super Agents and Mobile Money Operators, to expand their networks to deepen financial inclusion in Nigeria.

The facility is expected to enhance the capacity of the operators to roll-out more financial access points across the 774 local government areas in Nigeria particularly in the financially excluded locations.

To be eligible for the loan, MMOs and Super Agents according to the framework, “need to demonstrate capacity in agent network roll-out and management over a period not less than six months of commercial operations.”

It added: “Obligors shall not have a non-performing facility under any CBN intervention; verified existing and running technology infrastructure (software, hardware and processes) for agent management; verified existing provision of the services.”

It also must have verified existing agent structure presence in at least 10 states and 100 LGAs; evidence of agent banking transaction and operations based on returns to the CBN and six months transaction data on the CBN’s Global Mobile Payments Regulatory and Monitoring Platform (GMPM); certified Financial Systems platform application and Payment Card Industry Data Security Standard (PCI DSS) Compliance or other relevant industry certifications.”

The loans would be disbursed through Participating Financial Institutions (PFIs) for on-lending to MMOs and Super Agents within the timeframe prescribed by CBN while the credit risk is to be borne by the PFIs who will take three of the five per cent interest on the facility.

To ensure that the facility gets to MMOs and Super Agents, the framework stated that diversion of the fund, “shall attract a penalty at prevailing lending rate of the PFI and bar the PFI from further participation under SANEF.”

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“Charging of upfront interest shall attract a penalty at prevailing lending rate of the PFI. Charging of interest rates higher than prescribed shall attract the penalty stipulated by BOFIA section 60. Delayed disbursement shall attract a penalty at prevailing lending rate of the PFI.”