NERC Gives DisCos March 31 Deadline for Cashless Revenue Collection

The Nigerian Electricity Regulatory Commission (NERC) has directed the 11 electricity distribution companies (DisCos) to make the payment settlement platforms for their customers cashless from January 2, 2020.

The deadline for complying with the directive, according to the commission in its 31st December 2019 order, is March 31, 2020.

The Commission noted that DisCos are the designated revenue collection agents for NESI and failure to comply with this Order shall be treated as a breach of the terms and conditions of the distribution licence.

It is expected to reduce the collection leakages that have held the electricity market down, said NERC in the order that it posted on its website last night.

The order said: “Without prejudice to the provisions of section 10 of the Meter Reading, Billing, Cash Collections and Credit Management for Electricity Supplies Regulations, 2007 (the “Cash Collection Regulation”); all DisCos shall transit to cashless settlement platforms for the billing/collection of industrial and commercial customers by 31 January 2020.

“Without prejudice to the provisions of section 10 of the Cash Collection Regulation all DisCos shall transit to cashless settlement platforms for the billing/collection of R3 class of residential customers by 31 March 2020.”

According to the order, “the Federal Government issued a policy directive that requires the mandatory transition of certain classes of end-use customers of DisCos from direct cash settlement of bills to cashless settlement platforms in order to reduce collection leakages/losses and improve overall revenue assurance in NESI.

“The Commission notes that this policy directive complies with EPSRA and the laws of the Federal Republic of Nigeria as furthers the objective of improving transparency in NESI by introducing greater clarity on collections from end-use customers and prudence in the utilization of market funds.”

The order which the commission’s chairman, Prof. James Momoh and Commissioner of Legal and Licensing, Dafe Akpeneye signed was titled: “Order in the mandatory migration of R3 class of residential customers, industrial and commercial customers to cashless settlement platforms and other Matt relating to revenue protection in the Nigerian Electricity Supply Industry”.

NERC also directed that all DisCos shall leverage on available banking channels approved by the Central Bank of Nigeria (“CBN”) in complying with the directives.

It stressed that all the collection agents, super agents, sub-agents, payment solution service providers (“PSSP”) and payment terminal service providers (“PTSP”) engaged by DisCos that shall be duly registered with both the Commission and CBN.

Continuing, the commission directed that all duly registered collection agents and other service providers stated shall operate dedicated accounts strictly for the purpose of billing/collection of revenues from customers of DisCos.

The NERC insisted that – all DisCos shall ensure the successful transition of customers to cashless settlement platforms by ensuring the completion of the following tasks –

a. Promote the adoption of end-to-end electronic payments by all stakeholders in NESI.

b. Provide customers with appropriate bank account details and other approved channels for receiving/processing payments such as mobile money, electronic wallets etc.

c. Process electronic payment instructions in accordance with the rules of subsisting payments and clearing systems.

d. Publish details of customer service/contact centers to promptly address electronic payment enquiries along with stipulated timelines for addressing customer complaints.

e. Provide details of all CBN authorised payment channels including but not limited to automated teller machines (” ATMs”), quick response (“QR”) code, vending platforms, point of sale (“POS”) terminals, unstructured supplementary service data (“USSD”) etc.

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