Summary
The Nigerian banking code as mandated by the Central Bank of Nigeria requires all banks to provide their cardholders with the ability to control what type of transactions* are permitted** on their cards. Whilst the Central Bank of Nigeria prescribes no solutions, all banks need to comply with this code. Most Nigerian banks have tackled this requirement by requiring cardholders to physically visit a branch and specifically activate the channels they require on
their respective card (for example: ATM, POS, CNP, etc.). This is proving to be both a burden for banks (requiring investment in staff, process and systems development) and an inconvenience for cardholders (causing a reduction in card use and promotes alternative payment methods).
The Problem
Card fraud in Nigeria is at an all time high, and has become one of the largest loss leaders at Nigerian banks. Consumer confidence in card-based transactions is low, and fraud cases are increasing.
The Solution
FCMB implemented Tranwall TC at their processor, Interswitch Nigeria, and registered their current card-base into Tranwall TC. This made FCMB compliant with the Central Bank of Nigeria requirements for card control, and provided their cardholders with an effective and simple way to control their cards. The card control that FCMB implemented at Interswitch Nigeria provides FCMB cardholders with the functionality to either enable or disable their cards. This simplistic ‘master’ enabling and disabling of the card is applicable across all possible payment channels.
Cardholder Experience
Prior to the cardholder performing a card-based payment, they must ensure that the card is activated. To activate the card, the cardholder needs to send a specific SMS or USSD message using their mobile phone. Failure to activate the card prior use results in a message including the transaction value and the merchant name being sent via SMS to the cardholder informing them to first enable their card and then retry the transaction. Once the transaction has taken place, the cardholder can easily disable their card to prevent the possibility of fraudulent transactions.
Considerations
Whilst there is widespread GSM coverage in metropolitan areas, cellular data connectivity in Nigeria proves to be problematic. Seeing that Tranwall can be provided to cardholders in various ways, FCMB opted to provide the functionality to their cardholders using the USSD and SMS mobile channels only. Cardholders are required to send SMS or USSD instructions to enable or disable their card using their mobile phones. These instructions are simple textbased “CARD ON” and “CARD OFF” commands for SMS, and individual short-codes are provisioned for USSD.
* Central bank of Nigeria, circular: BPS/DIR/CIR/2010/GEN/01/169
** Central bank of Nigeria, circular: BPS/DIR/GEN/CIR/02/007
