• Business - Companies
  • Updated: 1 year ago

Nigerian Banks To Become Collection Agents For Electricity Payment

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Olalekan Fakoyejo

Fakoyejo Olalekan is a certified media practitioner from the Nigerian Institute of Journalism (NIJ)....

Nigerian banks will become the collecting agent for electricity bill payments. The electricity distribution companies will no longer be in charge of the collection as the Central Bank of Nigeria (CBN) intends to ensure discipline in payment of electricity fee.

According to a statement from the CBN’s director of banking supervision, Bello Hassan, the banks will now collect Discos' goods and service charges directly, as no entity, except the deposit money banks authorised by the CBN will handle payment collection.

The CBN said full responsibility for the collections and the remittances of the DisCos to both Nigeria Bulk Electricity Trading (NBET) and Transmission Company of Nigeria (TCN) will be handled by the banks that provide bank guarantees to NBET and TCN, "The payment or settlement of all NESI related goods or services shall be made through the Nigerian banking system,” The CBN disclosed.

"Consequently, all collections for the payments of NESI regulated goods and services provided by a DisCo shall be paid into a designated account such that collections arising from services rendered by the DisCo shall be paid into an account in the sole name of the DisCo; collections arising from services rendered by a third party/parties on behalf of the DisCo shall be paid into an account in the joint name of the DisCo and the third-party vendor(s).

[READ ALSO: Here's Six Reasons Why CBN Eliminated Third Party In Forex Applications]

“All energy and non-energy collections of DisCos, whether cash or cashless, shall only be performed by deposit money banks (DMBs). No entity shall be permitted to collect revenues for DisCos except if that entity is so authorized by a DMB in line with the relevant CBN guidelines for agent banking and agent banking relationships.

“Therefore, the DMB shall be permitted to authorize its agents to collect energy and non-energy payments on its behalf for any DisCo; the actions or inactions of the agent shall be the responsibility of the authorizing DMB. Any DMB found to be maintaining any account(s) for any entity collecting payments on behalf of any DisCo without appropriate authorization shall have regulatory actions imposed on it.”

“For the avoidance of doubt, no DMB is permitted to open or continue to maintain a collection account for a DisCo without the express no-objection of the DMB that guaranteed its exposure to NBET or TCN,” The CBN directed in the statement dated August 21, 2020.


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