Babajide Komolafe
5 January 2009
West Africa Bankers Association (WABA) has set up a fresh committee for the implementation of the proposed West Africa Inter-bank Payment System (WAIPS).
The new committee followed rejection of the Ecobank Transnational led committee set up for the implementation of the System early last year.
Pix. shows the Information Minister, Prof. Dora Akunyili (r) and the Environment Minister, Mr. John Odey during the recomposition of the Federal Executive Council, chaired by President Umaru Yar'adua at the Presidential Villa, Abuja. Photo by Abayomi Adeshida
The Association at its executive council meeting early last year constituted a committee to revive the almost moribund system. The committee comprised officials of WABA and Ecobank and was mandated to submit its report in November. The setting up of the committee followed persistent interest shown by Ecobank Transnational in the implementation of the system.
But at the meeting of the Association held in Sierra Leone in November, Financial Vanguard gathered that member banks kicked against the Ecobank committee and advocated an all inclusive committee. They argued that since the system is for all the banks in the region, it is not proper to commit it to one bank.
Consequently, a new committee was set up with the mandate to present its report at the Association's meeting early this year.
Financial Vanguard investigation reveals that the constitution of the new committee was spearheaded by some Nigerian banks with regional expansion bid who believed that allowing Ecobank Transnational to dominate the system will give it some advantage over other banks in the region.
WAIPS was initiated by WABA in 2000 with the aim of using it to enhance economic activities across the West African sub-region. Most importantly, the introduction of the system is meant to facilitate correspondence relationship among West African banks.
Presently there is no direct correspondent banking relationships among West African banks. As a result of this, payments for cross boarder transactions are routed through American or European correspondences which are often very expensive.
According to the Handbook and Manual of Operating Procedures for the system prepared in 2000, "The West Africa Inter-bank Payment System is a private sector initiative, fully owned by banks which subscribe to it. It is created to serve the interest of its member- banks by providing them with efficient and secure funds transfer system at very low cost.
The system was initially scheduled to take off in 2001. In fact the statement to that effect in the WABA official magazine in 2000 stated, "The 18th General Assembly of the Association has fixed the limit of the take-off date of the much-awaited West Africa Inter-bank Payment System at the end of the first quarter of 2001. As the recruitment exercise for the personnel of the system is about to be completed, this deadline is realistic".
It was also agreed that the Internet website address should be communicated to all members so that additional information required might be collected in a timely manner. But the take off date was later rescheduled for 2003. Investigation by Financial Vanguard revealed that as at 2003, ten Nigeria banks had already indicated their interest to become members. They include Diamond Bank, former Eko International Bank, EIB, Citizens International Bank, former Bank of the North and Afribank.
Others are former Allstates Trust Bank, former Fountain Trust Bank, First Bank, Oceanic Bank and former Societe Generale Bank. Also, WABA recruited for the system, Mr. Ebenezer Sakyi Ahinful, a Ghanaian by nationality and formerly an Assistant Treasurer with Citibank Abidjan while the technology infrastructure requirement of the system had been met and administrative details finalized for take-off.
But owing to a combination of factors among which, the consolidation exercise in the Nigerian banking industry, and administrative inertia in the secretariat of WABA occasioned by change of the Secretary-General of the regional bankers body, the system did not take off.
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