CBN, AGF in dilemma over Senate’s order on TSA

The Central Bank of Nigeria and the Accountant General of the Federation are in a dilemma over how to deal with the Senate request to cancel a valid contract which it signed with the owners of the Remita platform that drives the Treasury Single Account (TSA) of the Federal Government.

The system had helped the Federal Government mopped over N3 trillion into the TSA over a period of 12 months.

A director of the CBN admitted over the weekend that it received a second letter last week from Systemspecs Ltd, owners of the Remita platform requesting for its outstanding arrears and clarity on future collaboration with the apex bank.

The apex bank source said Remita had not been paid for its services since March 2015 when the platform began to track monies in Ministries, Departments and Agencies (MDAs) even though the Nigeria Interbank Settlement Systems NIBSS is not fully ready to undertake the project if it decides to breach the Remita contract.

Initial payment for the services of Systemspecs was taken back via a CBN letter dated October 27, 2015 and signed by the Director of Banking and Payments systems Department, Mr Dipo Fatokun.

In the letter, Fatokun said: “I have been directed to inform you that you should refund all charges made in to MDAs accounts as a result of the implementation of the TSA.”

Fatokun added “since the cost of collection must have been shared by all the stake holders, 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.”

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But the Executive Director of Systemspecs Ltd, Mr Aderemi Atanda declined to confirm if such 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,” Atanda said.

The letter which was copied the AGF and the MoF is believed to be the second in a space of three weeks demanding for a position regarding its contract and its payment.

While the CBN 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, however, has a different view.

Curiously, in a 42 page report prepared in February 2016, which contained the position of the Senate, the CBN was told to cancel the contract.

The Senate, which had declined to put its own fund in the TSA for transparency reasons told the CBN to terminate the contract with Systemspecs claiming the one per cent (1%) commission to be shared by all the parties involved are prohibitive (50 percent to platform providers Systemspecs; 40 percent to Banks; and 10 per cent to CBN).

Besides, the Senate said the CBN could continue with Remita but renegotiate the charges to 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.

Accountant General of the Federation said at the ICAN UK international zonal conference that  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.

The AGF said total inflow into the TSA was about three trillion naira mopped up from over 17,000 accounts of 90,076 MDA’s. The AGF said the TSA have instilled physical discipline and eliminated the process of cash backing MDA’s account with the commercial bank.

 

 

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