Economy

National Financial Switch Goes Live

The National Financial Switch has officially gone live with 14 out of 18 commercial banks in Zambia being connected to the system on Thursday.

The Financial Switch has been on trial since September last year.

As result of this development, all domestic ATM transactions by the various commercial banks are now being switched or carried on the National Financial Switch Platform.

Prior to this migration, all domestic card transactions were switched outside the country and treated as international transactions and were accordingly priced as such.

The establishment of the National Financial switch started in 2014 as a project under the Zambia Electronic Clearing House Limited.

This is a company owned by the Bank of Zambia and Commercial Banks but operates as an independent entity.

It was established with the objective of providing interbank clearing and payment services in the country.

The National Financial Switch project itself has been implemented as a two-phase project.

Phase one involves switching ATM and Point of Sale (POS) transactions from the VISA platform to the Switch and phase two will involve switching mobile payments transactions.

While the switching of ATM transactions has gone live as already mentioned, the go-live date for the point of sale transactions is scheduled for the third quarter of 2019, which will effectively complete the implementation of phase one.

Phase two of the project, on the other hand, involves the implementation of mobile payments switching which will facilitate the interoperability among all mobile payment operators in the country.

The implementation of this phase is already underway and it is expected to be completed by the end of the year.

With its completion, customers will be able to send money or make payments using their phone or other mobile devices such as tablets to any other recipient regardless of which mobile network they subscribe to.

Further, since the switch will interconnect with banks, non-bank financial institutions and other payment system service providers, customers will be able to transact.

The National Financial Switch is the first ever local nationwide shared platform, which will facilitate for interoperability of digital payments throughout the country.

And speaking at the Launch in Lusaka yesterday, Bank of Zambia Deputy Governor for operations Dr. Bwalya Ng’andu anticipates that there will be reduced fees and charges to customers because of the removal of international switching fees.

“We expect convenient, easy access and usage of electronic payment systems (ATM, POS, Mobile) through multiple access points countrywide; and increased innovation by creating a common payments loop for ATM, POS, Internet Banking, Mobile Banking, Agency Banking and other customer driven e-commerce products and services that might be introduced into market,” he said.

Other advantages of this system include reduced dependency on cash as people will have greater access to digital financial services.

It will also increase the security of transactions as they will predominantly take place in an electronic environment as opposed to paper based payment instruments and provision of near real time confirmation/validation of payment information and delivery of value to the customer.

This will reduce delays in customers receiving funds or money or reduce time and costs for processing customer transactions;

Dr. Ng’andu added that the system will allow faster circulation of funds in the economy due to the reduced transaction time.

“There will be increased volumes of transactions which can be processed on one single platform which will be expected to result in lower costs thereby making payment transactions more affordable; and increased financial inclusion through greater access and usage of financial services,” he said.

6 Comments

  1. Shikantwa

    Ati shani?

  2. Birthright Bemc

    Nice development

  3. Frank Sandulu

    This is awesome I really needed this to happen in Zambia now finally it is about to be done,Thanks be to God.Otherwise this is a good idea as someone of us who do online jobs,business and other online transactions this will be helpful,thanks.

  4. Frank Sandulu

    This is awesome I really needed this to happen in Zambia now finally it is about to be done,Thanks be to God.Otherwise this is a good idea as some of us who do online jobs,business and other online transactions this will be helpful,thanks.

  5. Christopher M.Mutambo

    This is a great move. A cashless environment will enable Revenue Collectors monitor 💻 Economic Transactions.
    This will also speed up the rate of doing business because all transactions will be done electronically.

  6. Siwale

    This is a great move and it can develop or improve the standard of living in rural areas.

Comments are closed.