FIRST National Bank (FNB)-Lesotho has officially launched its card localisation scheme aimed at enhancing financial inclusion and facilitating payments.
The FNB-Lesotho card localisation process is being done as a requirement in line with the Central Bank of Lesotho (CBL)'s recent introduction of the LeSwitch system.
Card localization is created to link with different systems such as Point of Sales (POS), Automated Teller Machines (ATMs), mobile payment systems, and online commerce platforms, to simplify electronic transactions and efficiently direct them to payment processors for authorization and settlement.
While FNB-Lesotho officially launched its card localisation programme last Thursday at Lehakoe Recreational Centre, it was first introduced to the bank's systems on 18 February this year.
FNB-Lesotho's Chief Financial Officer, Kamoho Mocheba, told the media at the launch event, that card localization comprised separating the services provided by the bank's ATMs, and POS machines from those in South Africa.
Mr Mocheba said that FNB-Lesotho debit cards and POS, which were previously being acquired and settled in South Africa, thereby charging local fees even when clients were transacting in South Africa, have now been localised.
"Meaning that the acquiring and settling of debit cards and POS are now localized, hence attracting international fees when FNB Lesotho clients transact in South Africa and beyond," Mr Mocheba said.
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He said charges would increase by 2% while purchasing or withdrawing cash outside the country, in the form of the Optional Issuer Fee.
"These fees transactions will include Eswatini and Namibia," he said.
FNB Lesotho OIF (optional issuer fee) is however still set at 0% currently, to allow for adequate communication period to clients.
He further explained that the transition of the National Payment Switch (NPS), results in all domestic ATMs and POS transactions being settled in Lesotho, through the Central Bank of Lesotho's National Payment Switch.
For her part, FNB Lesotho Retail Head, Nthabeleng Khoali, said the advantage of the card localization was that it would provide intra-operationalisation within local banks in Lesotho. That would create convenience and reduce costs in the future when the CBL launches the National Pay Switch.
"FNB card holders will continue to have the benefit of the services offered by the bank locally and internationally without any obstacle," Ms Khoali said.
Ms Khoali explained that during the process, there will be impact caused by the transitioning of the ATM & POS Transactions, where all FNB Lesotho card holders are to be charged international fees when transacting beyond the borders of Lesotho, including in South Africa.
"However, the localisation of the debit cards is expected to reduce ATM sharing costs domestically," Ms Khoali said.
She said on the POS transaction, there would be enhanced efficiencies on merchant services due to these changes.
