Bukar Umar Bolori

Department of Banking and Finance,

 Ramat Polytechnic, Maiduguri, Borno State, Nigeria



Electronic payment has dominated and attracted much attention much in recent time for Nigeria to join the league of developed economic by 2020 e-payment must from the bedrock of all financial transactions. This paper examined the concept of e payment where various types of e-payment system have been discussed. Benefits implication and challenges of e-payment were also analyzed. It is expected that an electronic payment system .should thrive in a society that has regular electricity, adequate ICT infrastructures, effective and efficient telephone network, etc but all these facilities are still epileptic, there are a lot of worries on how to address some of the identified challenges of the e-payment system. Finally a number in of suggestions have been proposed based on the challenges identified Among the suggestions is to put in place the necessary infrastructure  to enhance effective coverage of the e-payment policy across the three tiers of government that is federal, state and local governments so that the initiative will not end up a failed project.

Key Terms: EPS, EFT, EDI, ATM, ICT, POS, Vision 20:2020,



The initiative of Vision 2020 which aims to aims to put Nigeria among the 20 most developed economics by the year 2020 is a welcomed development in pursuing Vision 2020 we believe that there is need for efficient and effective payment system to facilitate commerce so as to respond to fundamental change in socio-economic trends. The payment system is the infrastructure which comprised of institutions, instruments, rules, procedure, standards and technology, established to effect the transfer of monetary value between all the parties. An efficient payment system reduces the cost of exchanging goods and services, and is indispensable to the functioning of any economy. However, a weak payment system may severely drag on the stability and developmental capacity of an economy; its failure canresult in inefficient use of financial resources, inequitable risk-sharing among agents. actual losses for participants, and loss of confidence in the financial system and in the very use of money The tasks to design payment system infrastructures become ever more complex as competition and innovation push constantly to limit the search for better combinations of efficiency, reliability, safety, and system stability in the provision of payment services to larger numbers of individual users and institutions.

Nigeria remains the hub of the West African market and any investor coming into Nigeria would easily access the sub-regional market and the rest of the African continent. Essentially, the main thrust of the present administration economic policy is to make the business climate more friendly by revamping the decaying infrastructure that are critical to productivity such as energy, transportation, telecommunications and creating a stable macro-economic environment. Also the government is determined to (cave a lasting legacy of transparency, good governance, accountability and the rule of law. Given the reform agenda alongside the return to democracy and the vast resources in Nigeria, the country is now set for orderly development and expansion of the economic base. The medium and long-term prospect for the country is very positive and, indeed, very exciting. Today there are up to seven different electronic payment channels in Nigeria. Automated Teller Machine popularly known as ATM's, Point of Sales terminals, Mobile, Voice, Web, Interbank Branch, and Kiosks. E-payments initiatives in Nigeria have been undertaken by indigenous firms and have been stimulated by improvement in technology and infrastructure. There has also been an upsurge in the use of ATM's which have brought convenience to banking but not without a few challenges for both banks and costumers. The web e-Payment market space continues to deepen, with some solution providers offering free access, and others offering value-added reporting and tracking services (Babalola, 2008). As payment is an integral part of mercantile process, electronic payment system is an integral part of e-commerce .The emergence of e-commerce has created new financial needs that in many cases cannot be effectively fulfilled by traditional payment systems. For instance, new types of purchasing relationships-such as auction between individuals online-have resulted in the need for peer-to-peer payment methods that allows individuals to e-mail payments to the other individual. Recognizing this, virtually all interested parties (i.e. academicians, government, business community and financial service providers) are exploring various types of electronic payment system and issues surrounding electronic payment system and digital currency. Some proposed electronic payment systems are simply electronic version of existing payment systems such as cheque and credit cards, while, others are based on the digital currency technology and have the potential for definitive impact on today's financial and monetary system. While popular developers of electronic payment system predict fundamental changes in the financial sector because of the innovations in electronic payment system (Kalakota and Winston, 1996).



The objectives of this paper are:-

  1. To examine the issues relating to e-payment system.
  2. To assess the benefits and implications of e-payment in Nigeria.
  3. To identify the challenges of implementing e-payment system
  4. To make suggestions where necessary ....more>>>>
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