Paystack Responds to NIBBS Directives on Banks Disconnecting Non-Deposit Financial Institutions
Paystack has urged its customers to remain calm in light of the recent directive from the Nigeria Inter-bank Settlement Systems (NIBBS) instructing banks to disconnect non-deposit financial institutions from fund transfer channels.
The payment platform reassured its users on Twitter that the NIBBS circular does not impact its services, emphasizing its developed relationship with Titan Trust Bank.
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The company’s statement reads:
“Hi, team, we wanted to reassure you that the recent NIBSS circular does not impact Paystack-Titan or any other Paystack services. We developed Paystack-Titan in partnership with Titan Trust Bank in a way that allows the service to operate compliantly, and it passed review from NIBSS.”
NIBBS recently issued a circular to commercial banks, directing them to disconnect non-deposit financial institutions from NIBBS Instant Payment (NIP) fund transfer channels due to violations of CBN guidelines.
Non-deposit financial institutions, including switching firms, payment solutions service providers, and super agents, were instructed to be removed from NIP fund transfer channels such as USSD, mobile banking apps, PoS, ATMs, and web and internet platforms.
The circular clarified that these institutions can process outward transfers as inflows to banks but are not permitted to receive inflows as their licenses do not authorize them to hold customers’ funds.
This development aligns with CBN guidelines, which mandate operators to obtain specific licenses, such as Switching and Processing, Mobile Money Operations, Payment Solutions Services, and Sandbox, to operate in Nigeria. The CBN emphasizes that only Mobile Money Operators are authorized to hold customer funds.
In another development, Paystack recently announced the termination of 33 employees in Europe and the United Arab Emirates, describing it as a challenging day. The company’s co-founder and CEO, Shola Akinlade, explained the decision and unveiled a four-month pay-off package for the affected workers.
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