This week will see a potentially significant development for the Sierra Leonean economy as the Bank of Sierra Leone officially launches the National Payment Switch, a system that, it is hoped, will move the country closer to achieving the objective of building a cashless economy.
The switch is a platform that facilitates interconnection and interoperability between the payment channels of various players including commercial banks, microfinance institutions, mobile money operators and fintechs.
The announcement of the switch was made on 19April, at the Sam Bangura Building in Freetown. However, the official launch will be on 29 April at the Bank of Sierra Leone recreation complex in Freetown.
According to the Acting Bank Governor at the Bank of Sierra Leone, Dr Ibrahim L Stevens, quoted in the Concord Times, “All debit and credit cards currently being used would be used on the National Switch and, once it goes live, it will ensure direct transactions between accounts of different banks, direct transactions between wallets of different mobile money operators and bank accounts and settlement of funds for transactions across schemes and between schemes and banks.”
The National Payment Switch, which will be owned and managed by the Bank of Sierra Leone, will roll out in three phases, the first involving ATMs and POS. The second will interoperate mobile money operators, other fintechs and bank accounts, allowing customers to make instant payments using any of these facilities from any location. Phase three focuses on international payments.
The switch will also make provision for buyers and sellers of financial products and services to make transactions across various channels.
If all goes well, it is hoped that, as well as users, the National Revenue Authority will benefit from the switch through more automated revenue collection, while banks and other payment systems will reduce costs and improve security.