Transition to cashless payment system require concerted efforts – Adeoti

Femi Adeoti, the group managing director at Routelink Group, a Nigerian ICT solutions provider, in this interview with BUNMI BAILEY discusses Nigeria’s digital payment landscape, fraud protection and opportunities for investors in the country’s digital space among others.


Cash is king in Nigeria, and despite the Central Bank of Nigeria (CBN)’s cashless policy, a lot of businesses in the informal sector have struggled. How can Nigeria go cashless? And how can it navigate its huge informal market?

The cashless policy is good; the benefits are numerous and will provide faster economic growth. However, it is important that the policies are right, and the implementations properly executed.

To achieve a smooth transition into a cashless payment system, all stakeholders must be involved – there must be representations from different stake-holding concerns – banks, digital payment companies, telecommunication companies, government sectors/parastatals, manufacturing sector, retail business sector, representatives from rural areas, etc.

There has to be an assessment of the needs of each of the pressure groups – for example, the needs in the rural areas will be different from the urban, and the needs in the eastern part of the country might be different from that of the North.

The needs for infrastructure on the bank side might be different from that of the digital payment companies etc. There is also a need for collaboration and partnerships – the policies must be jointly reviewed and drafted by the critical stakeholders bearing in mind the needs and resource requirements of various interest groups.

The plan should involve a process of ensuring proper education and awareness of the policies across different regions in the country depending on the identified needs. There is also the need to conduct a review of existing infrastructure to ensure adequacy before the policies take effect.

It’s also important that the stakeholders have enough time to ensure that adequate resources are provided in terms of infrastructure and human support. Then there should be a continuous process of reviewing the impact of the policies and improvements where necessary.

Nigeria recently launched its domestic card project. How will this impact the payment landscape?

The impact is going to be largely dependent on adequate education of the populace about the card scheme and what it represents for them and the country; ensuring that all stakeholders’ interests are adequately captured in order to ensure adoption.

For instance, banks will not drive this new scheme if it makes them lose their customers or generate less revenue compared to existing card schemes. Ensuring ease of access and ease of use; ensuring affordable pricing – affordable is subjective but a survey can give an idea of what will be considered comfortable to the adopters and users.

When all of these are in place, we will have a card scheme that can compete with any other domestic or international brands worldwide and help with our balance of trade and exchange, especially when used for foreign-based transactions.

It will also break the current monopoly enjoyed by existing card schemes and drive down the cost of acquiring and using the cards.

What are some of the issues plaguing the digital payment landscape in Nigeria today?

People still “TRUST” cash better than using a digital payment product or channel. Some products and channels are not easy to use. The product owners must ensure ease of use and create a smooth and seamless user journey and experience.

Inadequate information and education on the use of digital payment products and channels is another issue. Pricing has also become a deterrent to the adoption of digital products and channels.

The service providers incur huge costs in the development and deployments of these products hence need to ensure that the pricing can guarantee a return on investments.

Some people have argued that the country’s communication backbone isn’t strong enough to carry increases in the volume of financial transactions. What are your thoughts on this?

In the wake of the implementation of the CBN cashless policy and naira redesign, there is a need to transition to mobile and online transactions, and this has unarguably caused unrest in some parts of the country as the transition to the mobile transaction has also been a bit of a problem because the country’s communication backbone which includes the bank’s network and infrastructure was not able to accommodate this change.

Volumes of mobile transactions have increased astronomically, and the available infrastructure has not been able to meet up to the volume. This can be mitigated by improving the infrastructure and communication.

After leaving Inlaks as the MD, you went to start the Routelink Group. What is the company all about?

Routelink Group is a company that some of my friends and I started. The company has three subsidiaries – Routelink Telecom, Routepay and Routelink Enterprise. These companies play at major intersections between payment, telecoms, and enterprise IT.

There were some gaps we identified in these areas, and we were sure we could make a major difference as regards key areas of innovation and customer service. We have enjoyed some tremendous goodwill since we started. We currently have a payment license from the CBN to provide solutions and intervention in the financial services industry leveraging the use of technology.

In addition, we have four different licenses from the Nigerian Communications Commission among which is the Mobile Virtual Network Operators’ License (MVNO). MVNO is a new mobile license in the country, and we are one of the companies that have the license based on the perception of what we are set to do in the market.

We provide digital payment products and services across all channels ensuring the same efficient experience regardless of your channel of choice. Our drive to ensure optimum service delivery means that we have to continually innovate on products and services which has huge cost implications but gives us a lot of fulfillment given the feedback from our customers’ satisfaction survey.

We focus on addressing Pain Points and challenges by ensuring excellent customer experience end to end (from transaction initiation to completion). We are making digital payment products and services available to all and sundry regardless of their exposure and technology awareness, location, age, affluence, education, etc.

We are achieving these through the following: Industry partnerships where needed; Adoption of tested payment services models; Intervening with considerate pricing models;

Multiple transaction routing systems to achieve high Transaction Success Rate; Secure and trustworthy payment infrastructure and processes; Fast transaction processing; Periodic surveys to take feedback from users; Continuous service improvement; Continuous check and compliance with regulatory requirements; and fast resolution of disputes and disputed transactions.

We are excited about the opportunities that abound in the Nigerian marketplace, and we are determined to make a major difference as regards quality of service and innovation.

Despite the huge number of service providers in Nigeria’s financial technology and digital payments space, a lot of financial exchanges are still done via cash, how is RoutePay planning to enhance digital transactions?

Financial transactions are still done via cash and preferred by some persons due to factors such as poor digital infrastructure, poor internet availability and connectivity, lack of robust digital payment interface, lack of ICT knowledge, non-availability of ICT, fear of online fraud, cost of internet, unreliable networks, ICT phobia, and poor banking habits.

At Routepay, we are intent on enhancing connections in the payment space, providing solutions and infrastructure that will make payment possible and available without hassles,and driving digital payment transformation in a changing and demanding world thereby building more trust in digital payments confidence and usability.

We will engage the digital space with our omnichannel products and services and ensure that all demography is served. We have deployed solutions that address various concerns and pain points in the industry.

Security is at the heart of e-payment. How does RoutePay intend to tackle the issue of fraud and build confidence among users?

Protecting our customers is one of the chief decisions we took right from the onset of our business. We are aware that the issue of fraud is one of the reasons that people do not trust digital payment platforms, so we invested in world-class security infrastructure to ensure that our customers’ transactions and data are safe with us.

We have deployed systems that monitor and prevent fraud from happening and have conducted proper analysis of events that could lead to fraud and fraudulent practices. Our systems are proactive and very reliable as it is our mission to ensure that our transactions are safe.

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The current processes of reconciliation should also be fully automated, and the reporting format standardized so that information and data from one party to another can be easily consumed and used.

There are specific issues like trust. Some are concerned about the commercials and the cost of using the payment channels, what is the company doing differently?

Taking cognizance of the various pain points peculiar to different business segments, the company intends to ensure deployment of adequate and efficient infrastructure that enhances the ease of digital payment processes, ensure that our systems, products, services, and infrastructure are safe and secure for our customers and their customers to transact business with us.

Leveraging technology to deploy products and services with reduced cost implications on our side thereby enabling us to offer our products and services at reduced prices compared to the industry and assisting businesses by removing the challenges associated with other means of payment via POS, and USSD;

Additionally, we are creating diversities in payment methods to ensure that businesses can accept payment whether they have a mobile app or e-commerce presence, deployment of offline-based payment solutions that limits the number of interactions and iteration before a transaction is completed; and creating innovative ways of settling transactions funds to respective merchants even faster than the regulatory window.