POS Operators Threaten to Suspend Services Over Exclusivity Practice

 

The Association of Point of Sale Service Providers (POS) may suspend their services in the country if the Central Bank of Nigeria (CBN) and the FCCPC fail to intervene in the alleged exclusivity practice by Verve International and Interswitch Limited.

The association made the disclosure in a statement signed by Yomi Idowu, its Communications Consultant.

According to Idowu, the POS operators have written a letter to protest the alleged persistent unlawful decisions of the two companies, noting that the actions of Verve and Interswitch, negate ‘extant rules and regulations  of the Central Bank of Nigeria (CBN} and the Federal Competition and Consumer Protection Act  (FCCPC), 2018.

The Association of POS Service Providers emphasised that “As representatives of coalition comprising several Central Bank of Nigeria Licensed payment acceptors/acquirers, processors and switches they would have no option than to suspend acceptance/acquiring, processing  and switching  of Verve Card transactions.”

The Point of Sales Association in the letter was quoted thus that “This decision has become unavoidable due to the persistent and escalating unlawful conduct of Verve International (Verve) and Interswitch Limited (Interswitch),” which according to the Association jointly undermine “The integrity of Nigeria’s payments ecosystem, erode the capital base of participating  Institutions  and violates several regulatory  requirements.”

The Association highlighted the breaches as including but not limited to, maintainance  of an exclusive monopoly  over verve transaction processing; abuse of dominant position in the domestic card scheme market, contrary to Section 72 of the Federal Competition and Consumer Protection Act 2018(FCCPCA) and Section 3,4,7,3 of the CBN Guidelines on Operation of Electronic Payment  Channels; imposition of Scheme fees in excess of the regulated Merchant Service Commission (MSC) share attributable to Acquirers  under extant CBN regulations; and unauthorised and unlawful debits from settlement accounts of Acquirers, and Processors /Switches.

The POS Association recalled that its members contributed immensely to building the acceptance  and growth of Verve cards at enormous cost its members in compliance with CBN regulations without subsidy from Verve and Interswitch as domestic scheme in Nigeria.

Idowu concluded that “Ironically the Association emphasised that other Card Scheme operators have since abolished all forms of exclusivity in compliance with CBN regulations.”