The Group Head, Digital Banking, Sterling Bank Plc, Mr. Dipo Omogbenigun, in this interview says OnePay for Business, a contactless, cashless and cardless payment product, will make payments to merchants by customers to be more hygienic, Covid-19 compliant and faster. Excerpts:
Can you tell us about OnePay for Business and why it was introduced?
OnePay for Business is a contactless, cardless, cashless payment product. It is designed to help merchants or small business owners to receive money digitally from their customers. It was introduced because traditional payment methods such as cash and POS have not proven hygienic and Covid-19 compliant. We came up with a product that is Covid-19 compliant such that customers do not need to touch a POS or somebody else’s card that others have touched. With cash, you cannot know who has held it and the kind of places it has been to before it got to you. So, we wanted something cardless, cashless and contactless, and we came up with OnePay for Business.
How is it different from OneBank and a host of other digital payment solutions for merchants and customers launched recently?
OneBank is designed to help customers make payments to family and friends and also do other things like airtime purchases or bill payments, and many other things. However, OnePay for Business is the acceptance side of OneBank. The POS is there, but it needs a card to work with. Without a card, merchants would not be able to accept payment with a POS. What we have done with Onepay for business is to convert the merchant’s phone into a POS. This is why when you log in to the app, you will see a message that says, ‘Now your phone is your POS.’ We try to make sure that OnePay or OneBank customers or GoMoney customers can go to a merchant location and use OneBank or OnePay or any of those platforms to make payment at a merchant store using OnePay for Business. So OnePay for Business is the acceptance side, while OneBank, OnePay and GoMoney represent the issuance side. Think of OneBank as the card, and think of OnePay for Business as a POS. I want to add that OnePay for Business will also have an inventory module. The inventory module helps small businesses to keep stock of their products such that once they are running low, the app will notify them and request a replenishment of supplies from suppliers. OnePay for Business is also integrated with the suppliers, and we will now be able to offer suppliers’ credit to the merchants so that we will pay the suppliers, and then the merchant pays us in instalments.
So this implies that a customer intending to use the solution does not have to download a new mobile app to conduct other transactions. Can you confirm that, please?
No, you do not have to download a new mobile app because all the features you need to make payment at the merchant location have already been embodied on OnePay, OneBank and GoMoney. It means that if you have GoMoney, OneBank or OnePay, you can go to any merchant that has OnePay for Business and probably scan a QR code, and money will leave your OneBank account and go into the merchant account with Sterling Bank.
How would you explain QR codes to those who have no idea what they are?
One of the things that have happened to us over the past year is that COVID has become the chief innovation officer for most businesses. Many businesses have started looking at other ways to digitise their processes. And one of the things I have seen around is the use of QR codes in many places. Like in some restaurants in Lagos, you will find a QR code placed on tables for you to order the food instead of talking directly to the waiter. So, it means that businesses have started looking at QR code functionality. In response to your question, I will tell an Adamu that a QR code is a quick response code it is a machine scannable image that can be read using a smartphone camera and once that is done; the code is translated into something that human beings can understand and use for financial transactions. It is like scanning a bar code and using that information to confirm what a product is. It is a safe and easy platform for them to use to receive payment, and it is instant.
You spoke about QR codes being safe for both customers and merchants alike, but QR codes can also expose users to malware. Malicious QRs can be generated and displayed for an unsuspecting user to scan to give hackers access to their phones?
Yes, that is very valid. A QR code will encrypt that information into all the boxes and dots that you see. What happens is that when you scan a QR code, it points you to either a website or a phishing site. Customers need to know the QR code they are scanning. Now, on OnePay for Business, the QR code points directly to the merchant’s QR platform. Once you scan it, it takes you to the merchant’s QR platform, and once you get there, it will read the transaction information, and once you authorise the transaction, the money will move from your account to the merchant’s account. That is how we have built it, and it complies with industry payment standards PCI-DSS and all the other security protocols required for this type of payment product. Users should not scan any QR code that they do not know the source, but most of the time, a QR code will tell you that it is linking to something. From there, you can take an informed decision to move forward. Today, some people create QR codes to link their complimentary cards to their profiles to access their information by scanning that QR code quickly.
Some people put QR code on newspapers, and if you scan it, you will get information about the company and what their products and services are, and they link it with their websites. QR codes can be used for multiple cases, and I know that fraudsters and hackers will also try to use the QR code to do so many things, but you must launch OneBank or OnePay to scan the OnePay for Business QR code with the camera of your phone. It is encrypted and secured on both sides.
What type of QR Codes are deployed on OnePay for Business? Are they entirely dependent on mobile network connectivity?
We have two variants of the QR codes that we can issue to merchants. We have the static QR code and the dynamic QR code. The static QR code is a QR code that the merchant can print and place in the office or their store and even probably wear as part of their ID card. When a customer comes into the store, the customer can scan the QR code and pay for goods and services at the merchant location. The dynamic QR code is what happens on the OnePay for Business where, when you want to make a payment of N100, for instance, the merchant will dial N100 on his phone using the OnePay for Business app, and the dynamic QR code will be displayed for you as the customer. You, as the customer, will need to launch OneBank and search for the QR payment option, scan that QR code and money moves from your account into the merchant account. If the network at the location is weak, you can use the Bluetooth payment option. Once connected, details of the transaction will show on the merchant side once you authorise the transaction, and money will move from your account into the merchant’s account via Bluetooth. This is a new payment method. I am not sure many banks have it in Nigeria yet, but that is one of the many features we have on OnePay for Business. We are also introducing pay with transfer. We know that transfers are still being done, but the problem with transfers today is that, when you transfer in a merchant scenario, what typically happens is that the salesgirl will need to alert the manager or the owner of the store who may not be in the store to confirm the payment and it is only after payment confirmation has happened that the product will be released to you. OnePay for Business solves that problem because, once you pay into that account number, the salesgirl gets a notification on the app instantly and can decide to release the product to you. At the same time, the business owner is also able to get an online notification of that transaction immediately.
Beyond receiving and making payments, how does this solution benefit merchants, especially small businesses?
The primary reason why many merchants or SMEs have not been able to access loans is that the banks do not have visibility into their collections. They do not have visibility to the turnover they do majorly because their transactions are cash-based. A lot of SMEs’ customers as well do not have POS terminals. And for a bank, you want to look at the ability of that business to repay for the facility you want to give out. What OnePay for Business does is that it allows us as a bank to see how much money is coming through that business and make an informed decision. In fact, for OnePay for Business customers, once you have signed up and used it for a couple of weeks, we will be able to track your transactions, and we will be able to offer you a loan that would be disbursed into your account in a few minutes. That is one of the benefits of getting OnePay for Business.
Is this solution immune to the familiar poor network, failed transaction and issuer switch inoperative challenges associated with making and receiving payments in the country?
I cannot say it is 100 per cent certain. Looking at the peculiarity of our environment, we still have infrastructure challenges. This system is stable because it does not require a lot of data to pass the information between phones and through our servers authorising the transaction. Instances of failed transaction will be very low. Now, it is also a push payment. I call it a push payment because it is the customer who is pushing the payment to the merchant. Unlike the POS and ATM that are pull payment transactions with the devices pulling money from customers’ accounts. Push payment transactions are always easier because once the customer authorises the transaction, money leaves the account and moves to the merchant’s account. NIP payments have been very successful in Nigeria today because they are push payments. If I want to transfer money to you today, all I need is your account number and push the money to you by authorising the transaction. With the POS, when you insert your card into the device, the device will first ask which bank owns this card. After the issuing bank confirms the card, and also confirms that the customer has the money, it authorise the transaction before the terminal debits the account and complete the transaction. That’s like a flow of how it works and the same thing with the ATM as well. When you slot your card into the ATM, the ATM will always ask the switch.
Are you convinced that cardless, contactless and cashless solutions are the future of banking? What excites you about its prospect?
I will say that cardless, contactless and cashless solutions complement existing solutions in the market. POS came to complement cash payment, and cash is never going to go away. Even in advanced countries, cash is still there, and in other countries where contactless and cashless solutions are being deployed, cards are still being used. So, I don’t see this as something that will be the entire future of banking, but I see it as a shift. It will introduce a new shift to how merchants receive money from their customers and become a lifestyle product. What excites me about its prospect is that there are multiple use cases with this contactless and cashless solution. The possibilities are varying to the extent that we might even have a supermarket that doesn’t have a cashier sometime in the future where all you have to do is get to a supermarket, pick the items you want, scan the QR code on each item as it goes into your cart, pay on your phone and walk out of the supermarket.
I am looking at a future where, while you are on a bus, a QR code is placed in the seat in front of you and once you scan that QR code, you will see all the items a supermarket has for display and you can buy whatever you want and put the items in your cart and pay on the app or on delivery. That’s what excites me around it. I am looking at a scenario when you are watching a football match at home and your TV goes blank, but the QR code pops up on your screen for you to scan and once you can scan this QR code, you will make a payment from your OneBank app to the cable tv company, and your subscription is renewed instantly. We can use QR for withdrawal using the OneBank app because you don’t even need to touch our ATMs to get cash out of them anymore. Once you get to the ATM, you will see a QR code by the side, scan it and complete your other information on your phone, and the ATM will dispense the cash to you.
Despite remarkable advancement in banking, a lot of Nigerians are still unbanked. What do you think can be done to include this category of Nigerians?
I think we have started taking the right steps in the right direction, and we need to continue to develop solutions that cater to these needs, and some of these solutions may come in a combination of online and offline mode, which is one of the things that OnePay for Business is designed to do. We first need to get people to open accounts, and one of the quickest and easiest ways to make that happen is through mobile phones. If you look at mobile phone users’ statistics, they are higher than the total number of BVN accounts in Nigeria. The last time I checked, all the telcos combined have close to 120 million subscribers. Meanwhile, we have just 45 million BVN accounts. So, it means that there is a huge gap and the quickest way to close that gap is through mobile phones. If we can have a way to get most of these people who have mobile phones but are not banked to open accounts with the banks, then they can use the money in their accounts to make payment through platforms like OnePay for Business, this way we have built an ecosystem that promotes financial inclusion. So, if I pick an Adamu somewhere in Yola and he has a feature on his phone to open an account with Sterling Bank by dialling our *822# platform, and we open an account for him, we can ask his family or friends or anybody to fund that account, and that makes sense to him. And he can use that money to make payment for goods and services in his locality. If we provide a platform like OnePay for Business acceptance in that locality, he doesn’t need to look for a bank to withdraw that cash. He will do a transfer or a Bluetooth payment into the merchant’s account.