Akoma Chinweoke and James Ezema
29 June 2008
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Lagos — Mr. Kyari A. Bukar, Chief Executive Officer of ValuCard Nigeria Plc, a company owned by members of the community of Nigerian banks and Visa International Service Association could best be described as an inspiring and accomplished technocrat.
The Maiduguri born expert obtained a B.Sc Degree in Physics from Ahmadu Bellow University, Zaria, before proceeding to Oregon State University, USA where he bagged a Masters Degree (M.Sc) in Nuclear Engineering and attended an MBA programme at Portland State University also in USA.
He worked for14 years at Hewlett (HP), a leading world Information Technology Company where he held various senior management positions and joined FSB International Bank in April 2001, as the executive director in charge of electronic banking, information technology and operations and in June 2004 assumed his current position. In this interview he speaks on how the country can tap from the huge opportunities that digital economy offers as well as how the company enables issuance and usage of cards under international card scheme to develop the Nigerian market. Excerpts.
Key points
*Unlike ATM, Card usuage ensures a cashless economy
*E-payment system increases a country's GDP
*Nigeria's economy growing at a rate nearly twice than others in the world
*Cash culture paints a bad image for Nigerians traveling abroad.
FOUR years after as the arrowhead of this company, how has it been?
*Kyari Bukar...Nigeria cannot afford to be left behind
It has been an interesting journey because ValuCard is the pioneer EMV company in the country with the introduction of the ValuCard e-purse, in 1999 and it was a product that met the expectations and needs of our customers at the time. At this moment ValuCard is no more a payment scheme. We are a payment industry service provider. What that means is that, Valucard does not have her logo or name on cards issued by banks, or logo displayed at acceptance locations. We as a company that is the exclusive joint acquirer for visa international, acquire all transactions at point of sale terminal or over the internet here in Nigeria. Secondly, ValuCard is also an issuer-processor of visa cards and an acquirer-processor, and also offer various solutions in the payment space.
Our issuer-processing services now enable Nigerian banks to issue both domestic and international cards to their customers. By this service, international visa cards issued by Nigerian banks can now be used to pay for goods and services at point of sale abroad or over the internet. Essentially, we offer various innovative products to our customers who happen to be banks as well as merchants. We have various products which enables companies to control and manage their expenses effectively and efficiently by virtue of using visa cards. One of the solutions we will shortly introduce is the V-Money Transfer Service.
This service enables Nigerians in Diaspora and other persons who carry Visa cards to remit money anytime, anywhere. All these and other solutions are done seamlessly, securely in a very fast and efficient manner and also add extreme value to our customers as it is far more cost effective compared to previously existing services. By that I mean that our products are secure as our platform enables the remittance to be done without anyone knowing because the recipient would be notified that they have money on their cards and they can actually use it right there. With the card, they can go to a shop and buy goods and services. They can equally go to an ATM and withdraw the cash. So, they might not necessarily have to go to a bank branch to have access to their account.
The other solution we have is the Non-Resident Investors' Payment solution. This is another service we provide to enable foreign investors to invest their money in the Nigerian capital market conveniently and securely from the confines of their homes or offices, via the internet and without the risk of losing their money to agents or advisers with whom they may not have prior contact or relationship. This will be accomplished with collaboration with the Nigerian Stock Exchange and Central Securities Clearing System Limited. This is another solution that we provide that is basically linked with the great expectations we intend for our economy. Show me any country that is too much dependent on cash, I will show you a highly under-developed economy. So, one aspect of growth or economic development that is very crucial to Nigeria is this aspect of moving to a cashless society by embracing electronic payment system which would serve as a catalyst for accelerating the flow of money. E-payments encourage the velocity of money in the economy which enhances economic growth.
Considering the high level of poverty coupled with lack of technical know-how and financial challenges which have been identified as some of the factors that hinder digital revolution in Africa. How do you think these challenges could be surmounted?
Well, I think poverty is in the mind. Nigeria, by any yardstick should not be considered as a poor country. But at the same time Nigeria is not a developed economy. It is actually a developing economy and therefore we need to be humble enough to say to ourselves that there is actually a lot that needs to be done particularly when one has to look at it from the nature of infrastructure available. That should be a key area that needs to be addressed. It can be done in conjunction with the private sector. No doubt the provision of such services is in the realm of government, the government should not shy away from its responsibility of developing the infrastructure of the country. But at the same time it can offer incentives to private sectors as the private sectors will always show interest whenever there is enough incentives for them to get into these areas. Once there is a return on investment that is appreciable, then the private sector would jump in.
On the issue of whether Nigeria is ready for e-payment or cards. We cannot afford to be left behind. Nigeria is part of the globe, so we have no choice but to embrace the card culture. For example, most people that travel abroad with tonnes and tonnes of cash in their pockets are Nigerians. That gives you the notion that Nigerians are the only people that walk into a hotel abroad with sacks of dollars, even when they have to stay there overnight they actually pay by pulling out cash. And in most markets in the world, they look at them as criminals. Again, if you go to a hotel abroad at night and you want to get a room, I bet you that they are going to charge you highly because you are going to make your payment in cash. But if you have a card, you can actually make you hotel reservation in advance with ease. That way you can enjoy up to 15 to 20 per cent discount.
That basically can be done if you carry an internationally valid visa card that would ensure that you would get a room or whatever you want to purchase at a reasonable rate. Now apply that to the number of Nigerians that travel abroad every year and the savings is substantial. So, there are all kinds of multiplier effects when one moves with cards and there is transparency of transaction. These gains demonstrate to the economy that it is the right way to go. The other thing is lack of infrastructure which makes the business environment very challenging especially as we have issues with power, and telecommunications. But I believe that the telecommunications infrastructure in the country is improving.
We along with our valued
partner, the National Sports Lottery (NSL) are working together and have actually demonstrated that we can deploy a resilient and reliable payment infrastructure. The Point of Sale (POS) terminals which are being deployed by NSL have a technology called NSL Connect which has the capability of using the three GSM operators GPRS communication systems. So, if A fails, they would switch on to B and if B fails, they would switch on to C. These are creative innovative means of overcoming the infrastructural challenges.
Educating customers
Equally necessary is for us to push to help the banks to educate their customers to be using their cards not at ATMs per se but at the point of sale terminals. This is so because when you push ATMs, you are more or less increasing the cash in the market but if you push usage of cards at point of sale terminals, then you are moving the society toward being cashless. I will appeal to the banks to encourage their customers to be using their cards at point of sales terminals.
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