Opay Speaks After NIBBS Orders Banks to Disconnect Non-Deposit Financial Institutions

Opay Speaks After NIBBS Orders Banks to Disconnect Non-Deposit Financial Institutions

  • Opay, the mobile money company, has said it is not affected by recent NIBBS directives by banks to disconnect fintech companies
  • The company said on X, formerly Twitter that it is licensed by CBN to operate as Mobile Money Operator (MMO)
  • There have been speculations that Opay and other notable platforms are affected by the recent NIBBS directives

Pascal Oparada has over a decade of experience covering Tech, Energy, Stocks, Investments, and Economy.

Digital payment company Opay has reacted to the Nigeria Inter-bank Settlement System (NIBBS) directives to disconnect non-deposit financial institutions from funds transfer channels.

The company said on social media that it is not affected by the recent directive as it is licensed by the Central Bank of Nigeria (CBN) to operate as a Mobile Money Operator (MMO) and is insured by the Nigeria Deposit Insurance Corporation (NDIC).

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Opay, NIBBS
Opay responds to allegations it is included in NIBBS directives Credit: Bloomberg / Contributor
Source: Getty Images

Opay is a Mobile Money Operator

Opay said:

“We wish to state that OPay is not affected by the recent circular published by NIBSS.
The focus is on Payment Service Solution Providers, Switches, and Super Agents.
OPay is a Mobile Money Operator (MMO) licensed by the CBN and insured by the NDIC. Your funds are safe and secure with OPay.”

The statement by the company calms the nerves of users of the digital payment platform, who have been fretting over the security of their funds.

There have been speculations that the company was affected by the recent NIBBS instruction to commercial banks.

NIBBS discloses affected companies

NIBBS, in a circular to commercial banks, directed them to disconnect non-deposit financial institutions from funds transfer channels as it violates CBN’s guidelines.

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Legit.ng reported that a circular from the Nigeria Interbank Settlement System (NIBBS) had instructed commercial banks to disconnect every non-deposit financial institution from NIBBS Instant Payment (NIP) fund transfer channels.

The affected financial institutions include switching firms, payment solutions service providers, and super agents.

The NIP fund transfer channels include USSD, Mobile banking apps, PoS, ATMs, and web and internet platforms.

The circular said.

“Listing non-deposit-taking financial institutions such as switching companies (switches). Payment Solution Service Providers (PSSP) and Super Agents (SA) as beneficiary institutions on your NIP funds transfer channels contravenes the CBN Guidelines on Electronic Payment of Salaries, Pensions, Suppliers and Taxes in Nigeria dated February 2014.”

The NIBBS circular stated that while these financial institutions would be barred from receiving funds, they would be allowed to process payments into banks.

“For clarity, Switches, PSSPs, and SAs may process outward transfers as inflows to banks but are not to receive inflows as their licenses do not permit them to hold customers’ funds,” the circular said.

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Affected companies

Punch reports that to operate in Nigeria, operators must obtain at least one of the following licenses from the Central Bank of Nigeria (CBN): Switching and Processing, Mobile Money Operations, Payment Solutions Services, and Sandbox.

The CBN said only Mobile Money Operators can hold customer funds.

In a list seen by Legit.ng, the payment company was not included among the affected fintech firms and entities to be removed from funds transfer platforms.

Paystack reacts as NIBBS orders banks to disconnect Flutterwave, others from apps, other channels

Legit.ng reported that one of Nigeria’s payment platforms, Paystack, has reacted to the recent directives by the Nigeria Inter-bank Settlement Systems (NIBSS) to banks to disconnect non-deposit financial institutions from funds transfer channels.

The company said on X, formerly Twitter, that the recent NIBBS directives do not impact its services as it has developed a relationship with Titan Trust Bank.

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Unilever, GSK, 4 other major foreign companies that exited Nigeria in 2023

NIBBS sent a circular to commercial banks directing them to disconnect non-deposit financial institutions from funds transfer channels as it violates CBN’s guidelines.

Source: Legit.ng

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