Tuesday, 26 March 2019

CBN Set To Tackle Problems Of Failed POS Machines ,As Customers Complaints Keep Rising

The last 5 months have been hectic for the average point of sale (POS) terminal user across various banks in Nigeria over what is technically known as dispense error.

Nkechi Okafor, a trader in textile material who narrated her ordeal :

“I went to Balogun market (in Lagos Island) to buy goods. After picking the items I wanted, I brought out my card to make payment for the goods. The transaction failed so I was not given the items and I had to leave, only to discover that the money had left my account. It took almost two weeks to get my reversal

“I was frustrated within that period because I had no goods and no money for two weeks. The banks will say it is not their fault and I don’t understand whose fault it is.”

When  contacted four banks whose customers featured prominently in the  complaints’ log, they unanimously put the blame on the table of the Nigerian Interbank Settlement Systems (NIBSS).

One of the bank staff said: “It was terrible for us in December and March. We went from 800 complaints to 30,000. That is humongous; it makes it impossible to cope and customers do not understand this challenge. All they want is their money.”

The volume of POS transactions has grown at a compound annual growth rate (CAGR) of 123% between 2012 and 2016. In 2016, 63.72 million transactions were recorded. This figure increased by 130% to 146.27 million in 2017 and by another 95% to 285.9 million in 2018.

During a media parlay on Tuesday, March 19, the Acting MD/CEO of the Nigeria Inter-Bank Settlement System (NIBSS), Mr. Niyi Ajao, stated that the company was working towards doubling the record 285 million point-of-sale (POS) transactions recorded last year. Specifically, he put the expected figure for this year at 570 million transactions.

More growth has, however, led to more failed transactions. Last year, POS transactions recorded an 85% success rate. With growth in transactions expected to double in 2019.

On whether NIBSS has the capacity to handle more transactions while keeping failure rates down, he said capacity enhancement was among the top priorities of the company along with addressing timeout issues and reversals.

“Timeout is the total turn-around-time (TAT) for a POS transaction cycle from the time it is received from a POS to the time a response is sent back to the terminal.

“This TAT had been configured at 15 seconds in agreement with banks and processors. However, delayed responses from issuers after this timeout in recent times could cause authorised debits not to return to the terminal before the set TAT,” he explained.

Mr. Ajao noted that there is adjustment of timeout to 45 seconds from 20 seconds as well as disabling any issuer with delayed responses beyond 45 seconds with immediate effect to isolate such a bank. This process is on-going.

He said: “The infrastructure has been scaled up such that the system utilization is lower than 40% to prepare for expected higher volumes in the next few years. Implementation of an in-memory database system on the NCS platform to ensure super-fast responses at the center has been done and all systems have been load-balanced for non-stop performance.”

Mr Ajao said NIBSS has provided all stakeholders with a TraF (monitoring solution as-a-service) online for proactive monitoring in addition to the transaction monitoring platform for confirmation of transaction status.

The assurances that the problem will be completely resolved in a matter of days would come as a big relief to Nkechi and other users of the payment system across the country.

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