By:Justicia Shipena
Finance and Public Enterprises Minister Iipumbu Shiimi on Tuesday introduced a Payment System Management Billin the National Assemblyto enhance the Bank of Namibia (BoN) payment oversight.
Iipumbu noted that the bill is aimed at enhancing the powers and functions of the Bank of Namibia (BoN) to include the supervision and oversight of payment service providers previously regulated by the payment system management body.
The Payment System Management Bill will provide provisions for the conversion of the Payment System Management Body to the Payments Association of Namibia.
According to Shiimi, the regulatory authority and responsibilities of the Payment System Management Body have been revoked in accordance with worldwide best practices.
He said that moving ahead, the national payment system’s members will all be subject to the sole regulation of the central bank.
“Having two regulators in the national payment system has over the years created regulatory uncertainty and inefficiencies in the supervision and oversight of the national payment system,” he stressed.
The measure will establish general consumer protection guidelines that will apply to all payment service providers and payment system operators, he expanded.
Shiimi explained that the current Payment System Management Act’s legislative deficiencies made it challenging for the central bank to fully address some of the issues raised by a customer experience.
Thus, as part of the bank’s mandate towards consumer protection and financial inclusion, the bank has inserted certain provisions in the bill in this regard.
“And access information necessary to enable the Bank to effectively discharge its functions to oversee the safe, secure, and efficient functioning of the national payment system.”
According to the bill, the central will also supervise and be responsible for awarding licences, allowing payment service providers to offer their services within the federal payment system.
The Payment System Management Act of 2003is expected to be repealed by the Payment System Management Bill when passed by parliament.
The Minister assured parliament that the Payment System Management Bill, when passed, will enhance BoN’s majors regulatory and supervisory framework for the national payment system.
Shiimi said the payment landscape is constantly changing, with significant improvements in payment technologies, business models, and creative payment solutions occurring practically everyday.
He explained how, in the past, financial institutions dominated the national payment system, but that non-banks, often known as Fintechs, are now progressively offering digital and electronic payment services.
“Several significant gaps and shortcomings were noted in the existing legislation, which are salient in enabling the Bank of Namibia to effectively regulate and oversee the national payment system,”the Minister said.
The central bank will be in a position to encourage the integration of regional and continental payment systems, according to the proposed legislation.
He also pointed out that important parties, including the general public, the national payment system business, and pertinent regulatory bodies, had been consulted during the bill’s development.
