During a media parlay on Tuesday, March 19th, the Acting MD/CEO of the Nigeria Inter-Bank Settlement System (NIBSS), Mr. Niyi Ajao, stated that the company is working towards doubling the record 285 million point-of-sale (P.O.S) transactions recorded last year. Specifically, he put the expected figure for this year at 570 million transactions.
P.O.S volumes keep growing – The volume of P.O.S transactions has grown at a compound annual growth rate (CAGR) of 123% between 2012 and 2016. In 2016, 63.72 million transactions were recorded. This figure increased by 130% to 146.27 million in 2017 and by another 95% to 285.9 million in 2018.
More growth has led to more failed transactions – Last year, P.O.S transactions recorded an 85% success rate. With growth in transactions expected to double in 2019, Mr. Ajao was asked if NIBSS has the capacity to handle more transactions while keeping failure rates down. He replied that capacity enhancement was among the top priorities of the company along with addressing Timeout issues and Reversals.
Timeout is a problem – Timeout is the total turn-around-time (TAT) for a POS transaction cycle from the time it is received from a POS to the time a response is sent back to the terminal.
This TAT had been configured at 15 seconds in agreement with banks and processors. However, delayed responses from Issuers after this timeout in recent times could cause authorized debits not to return to the terminal before the set TAT.
Remedial Steps to be taken
- Adjustment of timeout to 20 seconds from 15 seconds on March 14, 2019. This is done already.
- Adjustment of timeout to 45 seconds from 20 seconds on March 19, 2019; to be done today.
- Disable any Issuer with delayed responses beyond 45 seconds with immediate effect to isolate such a bank. This process is on-going.
Reversals – Whenever there is a transaction decline, the system is supposed to reverse the transaction such that a debited cardholder would receive a reversal credit. Delays on reversal could be caused by
- Platform downtime
- Network issues at Processor level
- Delayed responses and Issuer/Switch Inoperative – Processor or bank is not available to receive the reversal even when it’s transmitted by NIBSS
- Fixing of platform application issues – February 21, 2019
- Network remediation carried out with concerned Processor
- Implementation of a secondary process whereby all reversals for any business day are re-transmitted between 10pm and 12 mid-night to return credit back to cardholders through their banks/Processors. Effective date is March 22, 2019
- Implementation of real-time reversal by POS terminals directly. This would require that banks are available to receive such online real-time. This would take effect by or before end of April 2019
- Policy stipulates that system resources must be enhanced once the 65% threshold is reached and we will continue to implement that
- The infrastructure has been scaled up such that the system utilization is lower than 40% to prepare for expected higher volumes in the next few years
- Implementation of an in-memory database system on the NCS platform on March 18, 2019 to ensure super-fast responses at the center. All systems have been load-balanced for non-stop performance
- Processors have been advised to ensure redundancy in of their network links for efficient fail-over whenever there is a service failure by any network provider as well as to scale up on infrastructure
- We have advised Banks the minimum system requirements for their front-end systems in order for them also to cope with higher volumes
- In effect, all service providers are expected to scale up on infrastructure because the strength of the ecosystem will always be equal to the weakest one
- The CBN has also waded in on the infrastructure matter with active engagements of stakeholders and timelines to achieve same
Monitoring – NIBSS has provided all stakeholders with a TraF (monitoring solution as-a-service) online for proactive monitoring in addition to the transaction monitoring platform for confirmation of transaction status.
Monitored parameters include:
- Transaction Status
- Failure Rate
- Stakeholder Availability
- Average Processing Time