The Central Bank of Nigeria (CBN) and the Accountant-General of the Federation are in a dilemma over how to deal with Senate’s request to cancel a valid contract with the owners of Remita platform that drives the Treasury Single Account (TSA) of the Federal Government.
The system has helped the Federal Government to mop more than N3 trillion into the TSA in 12 months.
A director of the CBN admitted that it received a second letter last week from Systemspecs, owners of the Remita platform, requesting for its outstanding payment and clarity on future collaboration with the apex bank.
The source said Remita has not been paid for its services since March, last year when the platform began to track monies in Ministries, Departments and Agencies (MDAs) even though the Nigeria Interbank Settlement Systems (NIBSS) which is being positioned to coordinate collection with Remita and partly owned by the CBN, is not ready to undertake the assignment should the apex bank decide to breach the Remita contract.
The initial payment made for the services of Systemspecs was taken back via a CBN letter dated October 27 last year and signed by the Director of Banking and Payments Systems Department,
Mr Dipo Fatokun.
Mr Dipo Fatokun.
In the letter, Fatokun said: ”I have been directed to inform you that you should refund all charges made into MDAs accounts as a result of the implementation of the TSA.
“Since the cost of collection must have been shared by all the stakeholders, you are hereby required to also provide a schedule of the total amount collected and the portion that was shared to each of the participants.”
But the Executive Director of Systemspecs Ltd, Mr Aderemi Atanda, declined to confirm if such a letter was sent to the CBN last week.
“We are talking to the CBN, the Accountant-General of the Federation and the Ministry of Finance about the way forward because we are not averse to renegotiation of the contract to move forward in the interest of the TSA success,” Atanda said, adding that “this is normal because they are the key stakeholders in the project”.
The letter, a copy of which was sent to the AGF and the MoF, is believed to be the second in a space of three weeks demanding for a position regarding the contract and its payment.
While the CBN, the MoF and the AGF are believed to be disposed to upholding the validity of the
contract and the use of Remita for the continued success of the TSA, the Senate has a different view.
contract and the use of Remita for the continued success of the TSA, the Senate has a different view.
The Senate, in a 42-page report prepared in February this year, asked the CBN to cancel the contract.
Curiously, the upper legislative house, which had declined to put its own fund in the TSA for transparency reasons, had told the CBN in one breath to terminate the contract with Systemspecs claiming that the one per cent commission to be shared by all the parties involved are prohibitive (50 per cent to platform providers Systemspecs; 40 per cent to banks; and 10 per cent to CBN).
In another breath, the Senate said the CBN could continue with Remita but renegotiate the charges to between between N500-N700 per transaction even though transactions run into millions and some transactions captured on the Remita platform had been as little as N200.
According to the Senate report, “given that the systemspecs provided solution and services at the nick of time, and has allowed it to be used in spite of a freeze on its upfront deduction, as transaction fees, the committee hereby recommends that its efforts should be rewarded based on the CBN approved rate band of between N500- N700 per transaction for electronic transfer/ payment as specified in the CBN revised guideline.”
The apex bank source, however, said it will amount to financial suicide to follow the Senate’s recommendation by allowing payment of up to N700 per transaction to platform owners. “Imagine paying N700 each for all the single transactions entering the system to Remita and other parties,” he queried.
The source, however said a more probable arrangement would be the submission of a committee led by the MoF to cap N100 payment per transaction not exceeding N5000 effective January 1 this year and the payment exemption of the big collection chunks that arrived through Remita between September and October last year. It is unclear if such offer will be acceptable to Systemspecs because of the significant loss of anticipated revenue from the software resource.
When asked about the MoF-led committee recommendation, Aderemi said: “We are open to renegotiation of the terms and to continue working with the stakeholders to make the TSA a success story.”
The AGF who spoke at the Institute of Chartered Accountants of Nigeria (ICAN) United Kingdom (UK) international zonal conference in London in the previous week, said the TSA is supported by two core systems, namely the Government Integrated Financial Management and
Information System and also the CBN Payment Gateway–Remita@CBN.
Information System and also the CBN Payment Gateway–Remita@CBN.
Represented at the event by Mr M. Zakari, the AGF said total inflow into the TSA as at end of March this year was about N3 trillion from over 17,000 accounts of 976 MDAs. The A GF said the TSA has instilled fiscal discipline and eliminated the process of cash backing MDAs account with the commercial banks. He said the Federal Government, which is the key promoter of TSA, will continue to provide guidelines on its implementation to ensure the maximisation of its expected benefits.
No comments:
Post a Comment