Foreign firms reject e-payment from Nigeria

Six months after it began, the electronic card-payment system issued by some Nigerian banks has been rejected by merchants in Europe and the United States (U.S.). Citing the prevalence of large-scale fraud, the merchants say the mastercards and other card-based instruments of payment from the country are “high risk.” 


Many of such would-be transactions originated by Nigerians through these cards have resulted in still births.


In many cases, the cold shoulders have not been because the card issuers cannot back them up with cash, but because “the card owners are located in Nigeria.”


The office of the Nigerian Cybercrime Working Group (NCWG) is currently inundated with letters from many merchants giving details of their reasons for rejecting e-commerce transactions with Nigeria-based persons and organisations: “Because you live in a high fraud area, we cannot process your order.”


The rejections, which cut across different business strata are also because the cards were issued by Nigerian banks in Nigeria.


The merchants alleged that even Nigerian correspondent banks abroad had also not helped matters. “Most of them have not been able to issue guarantee for these Nigerian-originated mastercards and other cards for the purpose of online payments to merchants abroad,” according to a European merchant.


If the trend continues, master-cards and other e-cards used as instrument for payments and commercial transactions may suffer a major setback.


Most affected for now are telecommunications and technology-based customers.


A major telecommunications company, which placed order for switches and base station transceivers may look for other means to actualise the transactions as its online merchant has repeatedly turned down its offer of payments through electronics means.


NCWG co-ordinator, Mr. Basil Udotai, confirmed at the weekend that the situation was very serious.


Once the merchant sees the billing address of its potential customers as Nigeria, the transaction is aborted.


He added: “Some of these online merchants have actually programmed their processing systems with an alert on Nigeria and once they notice the billing address as Nigeria, the system automatically rejects the card and end the transaction immediately.”


The Guardian also noted that even when the billing address is not Nigeria, transactions have been rejected on these cards when the shipping addresses indicate the country.