The Association of Point of Sale Service Providers (POS) has warned that it may suspend operations nationwide, citing some important reasons.
They claimed that if the Central Bank of Nigeria (CBN) and the Federal Competition and Consumer Protection Commission (FCCPC) do not urgently step in to address what it describes as an exclusive business practice involving two companies.
The group explained that it has already lodged a formal complaint through its website and submitted it to the relevant regulatory bodies, accusing the companies of engaging in repeated and unlawful decisions that, according to them, go against existing regulatory guidelines.
The Association sent its message in a recent statement through the Communications Consultant to the Association, Yomi Idowu.
According to Idowu, the POS operators have issued a formal protest letter against what they described as repeated unlawful decisions by two companies, arguing that these actions violate existing regulations under the Central Bank of Nigeria (CBN) and the Federal Competition and Consumer Protection Act (FCCPA) 2018, according to Guardian reports.
The Association of POS Service Providers also stressed that, “As representatives of a coalition comprising several Central Bank of Nigeria Licenced payment acceptors/acquirers, processors and switches, they would have no option but to suspend acceptance/acquiring, processing and switching of Verve Card transactions.”
It added: “This decision has has become unavoidable, because of the continued and increasing illegal actions of the firms which the Association claims ‘has the effect of compromising the integrity of Nigeria’s payments ecosystem, eroding the capital base of participating Institutions and breach[ing] multiple regulatory requirements”
Listed Issues by POS Operators
1. The group alleges that there is an exclusive control over the processing of Verve card transactions, which limits healthy competition in Nigeria’s payment system.
2. It also claims that there is an abuse of dominant market power in the local card scheme space, allegedly contrary to the provisions of the FCCPA 2018 and the Central Bank of Nigeria’s electronic payment guidelines.
3. According to the association, scheme fees are being charged above the portion of the Merchant Service Commission (MSC) allocated to acquirers, in breach of applicable CBN regulations.
4. They further allege that unauthorized debits are being made from settlement accounts of acquirers, processors, and switches without the necessary approvals.
Furthermore, The association pointed out that other card scheme operators have already eliminated exclusivity agreements in compliance with CBN rules, suggesting that the practices in question are no longer common within the industry.
