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Monthly Cheque Transactions Decline to N489bn

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CBN

A steady decline in the traditional cheque transaction may push the growth of mobile money in the country, a new report has shown.

There have been general declines in monthly cheque transactions in the country since 2016, sliding from N501.166bn in the month of February to N488.627bn in June.

A report from the Nigerian Interbank Settlement System on Sunday showed that cheque transactions worth of N464.553bn were carried out in January; N501.166bn in February; and N487.572bn in March, ending the first quarter.

In the second quarter of the year, spanning April, May and June, cheque transactions worth N472.465bn, N480.409bn and N488.627bn, were respectively executed.

In terms of volume of transactions, the NIBSS’ report indicated that while the total number of deals stood at 6,407,507 in 2015, only 5,731,805 units of transactions were recorded in 2016.

Going by the details of the data, what this means is a decline in the volume of transaction by 675,702 this year, when compared with what was transacted last year.

However, the report stated that Nigerians were moving away from traditional cheque transaction to a more convenient electronic means of carrying out financial exchanges, “as the value of half-year cheque transactions in 2016 dropped by more than 10 per cent.”

According to the NIBSS, the decline compares with the value of transaction during the same period last year, where more cheque transaction took place.

It stated in its report that from a total of N3.194tn cheque issuance value in the first half of last year, the figure crashed to N2.894tn during the same period this year.

From the report, the N300bn transaction difference represents about 10.36 per cent decline in cheque transactions this year.

A further analysis of the report showed that in January, February and March last year, the cheque issuance value stood at N541.062bn, N548.116bn and N565.138bn, respectively.

In April, the transaction value was N510.442bn; N487.937bn in May; and in June 2015, the figure stood at N542.08bn.

Meanwhile, the NIBSS stated that the steady move by Nigerians from traditional cheque transactions to electronic transactions might have positively impacted on the growth of mobile money.

In its fact sheet, it stated that the total number of customers on mobile money operations had risen to 29.13 million.

The report showed that the total number of agents enrolled at the end of the first quarter of 2016 (March) was 106,636; transaction volume within the quarter was at 14.09 million, while transactions value averaged N0.14tn.

From the document, the Central Bank of Nigeria has so far licensed 21 mobile money operators, with all of them already integrated to the NIBSS platform for interoperability.

It also indicated that Nigerian banks had issued over 24 million Bank Verification Numbers to their customers as of March ending, this year.

The report stated that while over 30.1 million account holders had enrolled for the BVN, only 24 million had received their verification numbers.

The number of enrolled bank customers thus represents about 34.7 per cent of the total 86.5 million bank accounts opened by government, corporate and individuals with various banks in the country.

“The purpose of the project is to use biometric information as a means of first identifying and verifying all individuals that have account(s) in any Nigerian bank and consequently, as a means of authenticating customer’s identity at point of transactions,” the Executive Director, Technology and Operations, NIBSS, Mr. Niyi Ajao, said.

“The BVN exercise will also provide a uniform industrially accepted unique identity for bank customers, to authenticate transactions without the use of cards, using only biometric features and Personal Identity Number identification of blacklisted customers,” Ajao added.

According to the NIBSS, starting from January 2015, 2.2 million accounts were enrolled; 2.7 million in February; 3.3 million in March; and by April, May and June, the figures increased to 7.7 million; 9.2 million and 12.4 million, respectively.

In July, August and September, the figure rose to 12.7 million; 13.7 million and 14. 5 million accounts, respectively.

The report added that in the last quarter of the year, 16.3 million accounts were enrolled in October; 21.2 million in November; and in December, the figure stood at 28.2 million.

In the first quarter of this year, the number of enrolled bank accounts for the BVN further increased to well over 32.1 million.

The data also revealed that the number of bank accounts opened with different banks in the country so far had reached 86.5 million.

The number of accounts opened so far in the country had increased from 75 million in January last year to 85 million by the end of December last year, it stated.

It also said the number of bank accounts residing with various banks in January this year rose to 86.5 million.

A further analysis of the bank accounts data, however, showed that the total active accounts in the country dropped from 59 million last December to 58.5 million at the end of January this year.

This means only 67 per cent of the total bank accounts opened in the country are active while 33 per cent are redundant.

Also, as of January this year, 59.7 million bank accounts were savings accounts; 23.4 million were current accounts; while other forms of accounts such as domiciliary, fixed deposit totalled 3.3 million.

Despite the number of inactive accounts, most account holders significantly used various electronic payment platforms for transaction in 2015.

According to the NIBSS Electronic Fact Sheet for the Year 2015, over N35.5tn transactions were carried out on various electronic payment platforms.

The transactions were carried out through the Nationwide Cheque Truncations Services platform, the NIBSS Instant Pay, the Electronic Bills Payment, Point of Sales, Automated Teller Machines and mobile money operators.

The NIBSS report showed that the number of the ATM cards so far issued by commercial banks in Nigeria had hit 41.89 million.

These include the Chip and PIN ATM card brands from indigenous Verve, MasterCard and Visa.

Following the report, “the country recorded a total number of the ATMs as of March 2016 stood at 16,660; the total number of active cards, 41.89 million; while the volume and value of the ATM transactions between January and March, 2016 stood at N0.12bn and N1.07tn, respectively.”

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Businessinsider, Nasdaq, Entrepreneur.com, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Computer Village Traders Demand Refunds as Lagos State Cancels Katangowa Project

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Traders at the renowned Computer Village in Lagos find themselves in a state of uncertainty following the abrupt termination of the multibillion-naira Katangowa project by the Lagos State Government.

The project, which was aimed at relocating the bustling tech market from its current site in Ikeja to the Agbado/Oke-Odo area of the state, has left traders in a state of limbo.

Despite the cancellation of the project reportedly occurring two years ago, traders claim they were not informed by either the government or the developers, Bridgeways Limited.

This lack of communication has left them in a precarious position, particularly concerning the substantial upfront payments made by some traders to the developers.

Chairman of the Computer Village Market Board, Chief Adebowale Soyebo, expressed dismay at the lack of communication from the authorities regarding the project’s termination.

He explained that neither the government nor the contractors had officially informed them of the decision, leaving traders in the dark about the fate of their investments.

Traders who had made payments to Bridgeways Limited now seek clarity on the refund process. The absence of official communication has compounded their concerns, with many uncertain about the fate of their investments.

While acknowledging the payments made by traders, Lagos State Governor’s Adviser on e-GIS and Urban Development, Dr. Olajide Babatunde, assured that the government would facilitate refunds.

He, however, said there is a need for proper identification and verification to ensure that affected traders receive their refunds accordingly.

The termination of the Katangowa project has reignited debates about the relocation of Computer Village.

Traders assert that the issue of relocation should not be raised until the new site is at least 70% completed, as per their agreement with the government.

The cancellation of the Katangowa project underscores the challenges associated with large-scale urban development projects and the importance of transparent communication between stakeholders to avoid such situations in the future.

As traders await further directives from the government, they remain hopeful for a resolution that safeguards their interests and ensures the continuity of one of Nigeria’s most prominent tech markets.

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Government Begins Disbursement of N200bn Support Fund to Manufacturers and Businesses

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The Ministry of Industry, Trade and Investment has initiated the disbursement of the long-awaited N200 billion Presidential Conditional Grant Scheme.

This is the beginning of a vital phase in the government’s strategy to provide financial assistance to manufacturers and businesses across Nigeria.

The scheme, which is being administered through the Bank of Industry (BOI), has been divided into three categories of funding, totaling N200 billion.

The disbursement process comes after an exhaustive selection process and verification of applicants to ensure transparency and accountability in the allocation of funds.

Doris Aniete, spokesperson for the Ministry of Industry, Trade and Investment, announced the progress in a statement posted on the trade minister’s official X (formerly Twitter) handle.

Aniete highlighted that verified beneficiaries have already started receiving their grants, signaling the beginning of the phased disbursement strategy.

“We are pleased to inform you that the disbursement process for the Presidential Conditional Grant Programme has officially commenced. Some beneficiaries have already received their grants, marking the beginning of our phased disbursement strategy,” stated Aniete.

She further disclosed that by Friday, April 19, a substantial number of verified applicants are set to receive significant disbursements.

However, Aniete emphasized that disbursements are ongoing, and not all applicants will receive their grants immediately, assuring that all verified applicants will eventually receive their grants in subsequent phases.

The initiation of the disbursement process comes after more than eight months since President Bola Tinubu announced the grant for manufacturers and small businesses.

The scheme aims to mitigate the adverse effects of recent economic reforms and foster sustainable economic growth by empowering businesses with financial support.

President Tinubu had outlined the government’s commitment to strengthening the manufacturing sector and creating job opportunities through the disbursement of N200 billion over a specified period.

The funding is intended to provide credit to 75 enterprises, each able to access up to N1 billion at a low-interest rate of 9% per annum.

However, the implementation of the programme has faced challenges, including delays and criticisms regarding the registration process.

Femi Egbesola, President of the Association of Small Business Owners, expressed concerns over the slow pace of data collation and suggested that genuine businesses were being discouraged from accessing the loans.

Despite the hurdles, the commencement of the disbursement process signifies a significant step forward in the government’s efforts to provide vital support to manufacturers and businesses, potentially revitalizing economic activities and driving growth across various sectors.

As beneficiaries begin to receive their grants, the impact of this initiative on the nation’s economic landscape is eagerly anticipated.

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MicroStrategy Rally Crushes Short Sellers, Wiping Out $1.92 Billion

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MicroStrategy- Investors King

Short sellers betting against MicroStrategy found themselves facing significant losses as the company’s rally wiped out $1.92 billion since March.

This development comes amidst a rally that has seen MicroStrategy’s stock outperform bitcoin, causing a considerable hit to those who had taken a bearish stance on the tech firm.

According to data from S3 Partners, short sellers have been on the losing end since March, as MicroStrategy’s stock surged, highlighting the impact of the rally on those betting against the company’s success.

This loss underscores the challenges faced by short sellers in a market where certain stocks experience rapid and unexpected price increases.

The rally in MicroStrategy’s stock is attributed to several factors, including the approval of several spot bitcoin exchange-traded funds (ETFs) by the Securities and Exchange Commission (SEC) earlier in the year.

This move by the SEC brought bitcoin, a once-nascent asset class, closer to the mainstream and fueled investor interest in companies like MicroStrategy, known for their significant holdings of the cryptocurrency.

MicroStrategy, which held nearly 190,000 bitcoin on its balance sheet as of the end of 2023, has indicated its intention to continue increasing its exposure to the digital currency.

The company’s decision to sell convertible debt to raise money for additional bitcoin purchases further bolstered investor confidence and contributed to the stock’s rally.

Analysts at BTIG noted that the premium for MicroStrategy’s stock reflects investors’ desire to gain exposure to bitcoin indirectly, especially those who may not have the means to invest directly in the cryptocurrency or ETFs.

The company’s ability to raise capital for bitcoin purchases is seen as a positive sign for shareholders, adding to the optimism surrounding its stock.

However, despite the recent rally and optimism surrounding MicroStrategy, the crypto industry as a whole continues to be heavily shorted.

Short interest in nine of the most-watched companies in the crypto space remains high, standing at 16.73% of the total number of outstanding shares, more than three times the average in the United States.

Moreover, concerns persist regarding the SEC’s stance on cryptocurrencies, with some experts suggesting that the approval of spot bitcoin ETFs may not necessarily indicate a broader acceptance of other similar products, such as spot ethereum ETFs.

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