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PoS Operators Lament CBN’s N50 Stamp Duty Charges, Call For Review



  • PoS Operators Lament CBN’s N50 Stamp Duty Charges, Call For Review

The Central Bank of Nigeria’s policy of N50 charges on every individual transaction above N1,000 carried out on the point of sales (PoS) machine has received heavy criticism from agent banking service providers.

The individual transaction and withdrawal through the use of (PoS) machine have enhanced and eased the banking system and also reduced the number of customers that visit the banking hall, queues at bank counters and the ATM machine centres.

The recent policy by the apex bank could be seen as a disastrous move mainly for the merchants, filling stations and supermarkets across the nation which also affected the enjoyment of cashless transactions.

The Effect of N50 PoS Charges

The N50 charge imposed on individual transactions above N1,000 is currently having negative effects since its implementation on September 17, 2019.

Agent banking service providers have been on the receiving end since the implementation of the policy with the mass exodus of bank customers who have resulted back into their conventional way of doing transaction and withdrawal.

The agent banking service providers lamented that the volume of electronic payments carried out daily had reduced drastically as a result of the new policy.

Also, many filling stations in Lagos and Ogun states expressed their dissatisfaction with the policy, explained that customers are reluctant in paying the N50 stamp duty which is really affecting sales.

Meanwhile, many Supermarkets in Lagos have refused to implement the new policy for the fear of how it will affect their sales and patronage.

The CBN New Policy 

On September 17, 2019, the apex bank issued a circular which it authorised the banks to unbundle merchant settlement amounts and charge applicable taxes and duties on individuals as it reviewed the merchant service charge from 0.75 per cent (capped at N1,200) to 0.50 per cent (capped at N1,000).

The CBN directed all PoS and web processing officers to ensure that stamp duty was correctly processed daily by downloading transactions valued at N1,000 and above, multiply the count of these transactions by N50 and pass the corresponding debit to the respective merchant accounts.

Reactions To The N50 PoS Charges

The operators under the aegis of Association of Mobile Money and Bank Agents in Nigeria (AMMBAN) and business owners have all reacted to the new policy, all pleading that it should be reviewed.

According to the association president, Victor Olojo said the CBN’s policy is discouraging and will affect the apex bank’s efforts in encouraging cashless policy.

“It has grossly affected transactions. People now prefer to go back to the Automated Teller Machines rather than the PoS because of the charges.

“It is a big issue for us and we feel that the government needs to listen; that policy should be reversed. We have written a letter of protest to the CBN and other relevant stakeholders. We feel that the policy is anti-people because it is the same government that is driving financial inclusion that is also imposing this tax that is affecting those at the base of the pyramid.” he said.

Also, a mobile money operator with agents in five locations in Kwara and Oyo states, Mr Oluwasegun Abbey in an interview with PUNCH said the volume of transactions has reduced since the introduction of N50 stamp duty on individual payments.

He said, before the new policy, he conducted between 800 and 900 transactions daily across the five locations but it has reduced to between 600 and 700 daily.

Recall that the Nigeria interbank Settlement System (NIBSS) earlier this year released report revealing how the online transaction has increased and reduced the number of payment made by cheque.

According to the reports, the volume of transactions on PoS terminals across the nation rose to 187.7 million and the financial payments on the terminals were valued at N1.38tn.


Debt Market: Dangote Cement Raises N250 Billion in H1, 2020



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Dangote Cement Raises N250 Billion From Debt Market in H1 2020

Dangote Cement raised a total sum of N250 billion from the nation’s debt market in the first half of the year, according to the FMDQ Securities Exchange Limited.

In the statement published on the FMDQ website, the N250 billion debt includes the N100 billion Series 1 Bond raised under Dangote Cement’s N300 billion Bond Programme and the N150 billion Commercial Paper (Series 13-16 Domestic CP Issuance Programme) offered earlier in the year and now listed and quoted on FMDQ Securities.

Mr Michel Puchercos, the Chief Executive Officer, Dangote Cement, was quoted as saying, “This landmark transaction is the largest-ever bond issuance by a corporate issuer in Nigeria.

“It allows us to further broaden our sources of funding by accessing long-term debt at competitive costs from the capital market and builds further on the success of our domestic commercial paper programme.

“The success of these transactions, in the current challenging environment, illustrates investors’ continuous confidence in Dangote Cement’s strategy, strong cash generation and solid credit profile.”

Mr Kobby Bentsi-Enchill, the Executive Director and Head of Debt Capital Markets, Stanbic IBTC Capital Limited, said, “Stanbic IBTC Capital Limited has a long history of partnering with Dangote Cement Plc, and are delighted to have advised on this landmark corporate bond issuance, which reflects the depth and diversity of the Nigerian debt capital markets.”

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Conoil Profit After Tax Declines by 20 Percent in Q1, 2020




Conoil Profit Before Tax Depreciated by 20 Percent in Q1 2020

Conoil Plc, Nigeria’s indigenous oil marketing company, on Tuesday declared a 20 percent declined in both profit before tax and profit after tax for the quarter ended March 31, 2020.

In the unaudited financial results released on the Nigerian Stock Exchange (NSE), Conoil grew revenue by 7 percent from the N35,637 billion filed in the same quarter of 2019 to N38.143 in the first quarter of 2020.

Also, the company’s retained earnings expanded by 8 percent from N14.395 billion in the corresponding quarter of 2019 to N15.556 billion in Q1 2020.

Accordingly, Shareholders’ funds appreciated by 6 percent from N18.566 billion filed in the first quarter of 2019 to N19.728 billion in the same quarter of 2020.

However, profit before tax declined by 20 percent from N468,202 million in Q1 2020 to N382,915 million during the period under review.

The tax paid by the company during the period also declined by 20 percent from N153,025 million in Q1 2019 from N122,533 million in Q1 2020.

The company’s profit before tax declined by 20 percent from N325.178 million in achieved in the first quarter of the corresponding year to N260.382 million in Q1, 2020.

Similarly, earnings per share also declined by 20 percent from 47 kobo in Q1 2019 to 38 kobo in Q1 2020.

Total assets declined from N63.584 billion in Q1 of 2019 to N58.760 billion in Q1, 2020.

Conoil owned equity expanded from N19.467 billion achieved in the first quarter of 2019 to N19.728 billion in the first quarter of 2020.

Total Liabilities declined from N44.117 billion in Q1 2019 to N39.032 billion during the period under review.

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FMDQ Group Admits Dangote N100bn Bond, MTN N100bn Commercial Paper



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FMDQ Group Admits Dangote N100bn Bond, MTN N100bn Commercial Paper

The FMDQ Group has said the admission of both the N100 billion Dangote Cement bond and MTN Nigeria N100 billion commercial paper shows the potential of the Nigerian capital market to drive and stimulate economic growth.

The two most capitalised companies successfully raised N100 billion each from the capital market despite the COVID-19 pandemic and economic downturn.

Bode Onadele, the Chief Executive Officer, FMDQ Group, said: “The market has been yearning for corporate benchmarks for pricing and valuation of securities in the debt capital market, and coming at a time when the resilience of the Nigerian financial market is being tested by the impact of the COVID-19 pandemic is even more commendable.

The success of these issuances by the premier and largest business conglomerate in Africa, Dangote Industries, through its subsidiary, Dangote Cement Plc, and the debut made into the Nigerian debt capital market by leading telecommunications giant, MTN Nigeria Communications Plc, lay credence to the untapped and great potential of the Nigerian capital market to support sustainable development in Nigeria, and the confidence of investors, as well as the commitment of FMDQ Group to empower the markets to deliver prosperity to Nigeria and Nigerians.”

Onadele said the inclusion of the two securities on FMDQ validates the innovative and credible capital market solutions championed and efficiently delivered by FMDQ, over the last few years.

“Furthermore, in line with its mandate to facilitate global competitiveness of the Nigerian financial market, FMDQ, through these admissions, has provided the market and its diverse stakeholders – local and international – the much-needed corporate benchmark for the bond and commercial paper markets,” he said.

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