John Obaro is the Managing Director/Chief Executive, Systemspec Limited, an indigenous I.T firm that developed Remita, an information technology platform used by the banks, federal government and some states for e-payment, e-collection and e-payroll. In this interview, during a conference on, Winning Big With E-Payment, organised by the company, Obaro spoke on the state of the e-payment industry in Nigeria and the role of Remita in future of the industry. Excerpts
What is your assessment of e-payment in Nigeria presently?
Our assessment is that it is something that has placed Nigeria where we have something to offer to the world. Especially in the area of corporate payment, I personally will be interested in entering into a competition with any country that has been able to achieve the kind of things we have been able to achieve here in Nigeria. I mean we have a very efficient platform now and it’s proven. Many other countries did not have the kind of problem that we have suffered from, and they were not as desperate to come up with solutions that we were forced to come up with.
What is the connection between Remita and the cashless policy?
Remitter is an e-payment platform and for quite a while now, we have been propagating the gospel that we believe to a large extent that we can minimise the use of cash but at some point in the future I believe the society can operate without the physical cash. With the kind of rate at which technology is moving, I easily see a day ahead when the society an easily operate without cash but at this point in time what Remitter does is promote payment electronically, paperless.
For quite a while, we say each time you hand-write a cheque, just know that remitter could do the same for you. We can encourage people to stop handwriting cheque, use their mobile device or computer; they would have the same thing the cashless way. That is where Remita comes in. We want to reduce people’s need for handwriting cheque, we want to reduce the need to make payment using physical cash.
I heard it said that an individual can decide not to write cheque, can you expatiate on that?
As I said, our objective is that we do not want to see cash; we don’t want to see cheques. We believe these things can be done in an electronic manner both from a corporate perspective where you have joint signatories and from an individual perceptive. An individual can instead of writing cheques to his father or mother, send an electronic cheque to achieve the same thing.
What we have on our screen is to make it look like the image of a physical cheque, just complete the necessary details as would have in handwriting a cheque. You achieve the same goal electronically, you monitor the transaction yourself even from a historical perspective. So even though you are an individual, you will be able to see all the cheques you have issued over the last ten years for instance.
What’s more especially for individuals, is that they can give standing order payments. For their routine payment, they don’t have to keep writing a cheque all the time. You just have to write one and the system remembers at every recurring date of the mandate. So, yes individuals can use it hand-write a cheque normally or to issue standing order payments to clients.
Remita has evolved over the last seven years; can you trace the challenges you have faced so far?
The first challenge is that the original project that we intended to address in 2005 didn’t quite work out because the focus of the Pension Office then was different. But because we had developed what we knew was a very successful application, we then had to redirect the application to focus on payment. Thank God that has proved to be successful.
Now we can do not just payment but we have been able to get on board to Pension Funds Administrators (PFAs) and part of the significant sums of money are paid today through Remita to the pension industry. So the first major challenge we had was that all our transactions were going through the switch and we had challenges because of the volume we were simultaneously trying to pass through the switch.
This is because this switch was designed primarily to serve individual customers who want to do one transaction at a time. They maybe many but they do it one at a time as against where we started which was salary processing and you need to pay fifty to one hundred thousand people at once through the same file. So we were having quite some technology issues. That led us to start thinking of an alternative approach to the same problem and that’s how we ended up creating the non-switch model. This involved a lot of technology thinking and accounting knowledge to be able to arrive at that model. That’s one major challenge we had along the way.
The second challenge we had was because of the way the non switch model worked. It has advantages and disadvantages. One advantage is ease of deployment. Any bank can come on board, and within one to two hours you can set up a new bank or microfinance bank, electronic purse or whatever. The disadvantage was that some banks having set up the application and it was working did not take it to our recommended next level which was a full system integration with their banking application to do a straight through process.
Now that has taken awhile to resolve but happily as at today we have about twenty banks that have completed this straight through process which means that we will now have a far more efficient processing platform. Another challenge we had was that having brought in payroll and all that features that makes life easier for customers and because we tend to work with banks, they would have agreed some fixed amounts with customers and no matter what you come up with after that, they now expect you to reduce your own price to match whatever random number you have promised whoever. Those are the challenges but we will continue to educate that for you to have premium platforms, you need to invest in technology financially.
How were you able to convince Nigeria Interbank Settlement System (NIBSS) to the level that they now trust you and now want to replace all of their major software with Remita?
I can say that any assignment we are given, we put our heads into it and make sure it succeeds. This is because the track record of Remita in the industry is gradually gaining traction. Initially people ignored us and didn’t think that we will succeed. But in time we have succeeded, especially when we had the federal government’s mandate in January, 2012.
One of the reasons why the project succeeded was because those who did not want it to succeed were so carried away that it would not succeed and they just left us to sink but by God’s grace it has become a visible success to everybody. And because this has succeeded, it opened the door for more interests in what we are doing. And as you are aware, NIBSS has also had a change in leadership, a change in vision and they are equally interested in coming up with industry wide solutions that would add to the efficiency of not only the banking community but the economy as a whole.
Having seen what we are doing, it became very easy for us to talk together and arrive at a partnership to creating a platform of leapfrogging in terms of efficiency both for the banks and the user community. Hopefully in the coming weeks, the market will be hearing more of what we are doing with NIBSS.
How ready are you for the government, given the plans that it has for e-project this year to which you are connected with all of them?
One thing that has distinguished us over the years is that you cannot associate us with any failed project. Having committed to any project, if we have to do it at a loss, we do it at a loss, because having committed to the project we put our neck into it until it is successful and in line with our regional mandate. One thing that God has blessed this company with is very intelligent and enthusiastic workforce which you would have seen in your interaction with them at various levels.
That apart, we believe in the passion that we have in the organisation, that any assignment we are given, we will deliver. Even for Nigeria, our country, it’s a vision come true, being given the privilege to deliver those things. So by God’s grace we will not fail. Where we may have problem is if for some reasons some individuals try to frustrate this project.
We have had two or three unpleasant situations in the past where because of the level of corruption in the country, some people deliberately do not want this type of project to succeed. Unfortunately we do not always have an answer to confront that, because we would rather work in the society than succumb to practices that destroy our 22 years investment in this technology. So to your question, if we are ready, yes, we are very ready and by God’s grace we will succeed.
Which of the factors, ranging from opportunity, competence to political will, has most helped Remita to succeed in the past seven years?
I am not sure I know the difference between opportunity and competence because you may have the competence and may not be given the opportunity. On the other hand, you may have the opportunity and may not deliver. Also, if you have the opportunity and do not have the competence, you are bound to fail. So maybe I would put the two of them at the same place.
Thank God we have the competence and platform, so when we had the opportunity it was very easy for us to deliver. Political will, unfortunately we don’t do too well because we are a technology firm, we enjoy technology and we have focused on technology to come up with excellent and usable technology. So while spending time to develop technology, I wouldn’t say we have enough time to develop what you would require as political will. So in that order I will say competence, opportunity and then political will.
Being a wholly Nigerian product, what are your plans to take it outside the country to sell it to the world and has there been any competition from any foreign solution whatsoever?
Like you rightly mentioned, the issue of opportunity comes in and I believe we must prepare to meet opportunity so that when the opportunity comes we would at least be able to recognize it. And that’s what we are trying to do, develop the product, now we are here, we are looking for the opportunity and one of the reasons we brought this to Ghana is to begin to psychologically prepare the people. Beyond the human managers, Remita too can move into other countries.
Looking at the way Remita has been accepted, where it is going, I am very sure that many people may be having the concern that so much of the nation’s payment infrastructure is relying on this solution. They also might want to ask, even yourself, do you ever think that you are assuming so much responsibility in the country’s e-payment space?
As far as we are concerned, the whole of Nigeria is still one customer. When we have covered maybe thirty to forty countries, maybe I would then be able to think about the question you raised. In other words, the Nigeria market, it’s a computer that’s running it, and we are not scared in any way of the volume and we believe that with what we have, we will be able to address the issues on ground.
Part of our immediate dreams is how to move beyond the borders of Nigeria, so we are actually not scared by what we have on ground now. The other question of what people might say, I would say it’s about time we began to have confidence in ourselves and if a whole nation that can give their identity to another, we don’t have to do that.
Many of the things that we have done in this country, we give it to foreigners, that question does not come out, why is it that when it is an indigenous company that we suddenly become aware that its one company. I think we need to move beyond that and develop confidence in ourselves as a people. Nobody gave us a chance for this project to get to where it was and there are a number of projects that foreign friends have moved into that failed and local friends have moved in and succeeded. So I believe that Systemspec will set that track record as a company that the nation can feel comfortable with.
What was your real objective when you were designing this e-payment conference?
The reason is that Remita has been proven to be a reliable solution, very easy to use, set up and operate on a continuous basis. Having established that it works through interaction with the customers, we want to really create the awareness for people to know, because there is no use having such a fantastic solution if the market is not aware of it. And to get to the market we believed that one of the factors would be to work through the banks who already have accounts of some of these customers and that is why we said let’s organize a programme like this, take the bankers to a place where they cannot be easily distracted and have their attention. This is so that together we can look at the solution, understand the product better, and they will take it to their customers.
From all the discussions and the interaction and feedback, what would you say is your major take home from the banks?
My major take home is a clear reconfirmation that there is a gap in the Nigerian market. We have a solution that clearly addresses the needs that we set out to resolve and we knew the enthusiasm on the part of the banks. So all and all, I am optimistic that the solution has met the market and now we will just move on to delivery.
Is this particular event going to become a recurring decimal in the history of Remita?
That is our dream. Periodically we should be able to meet with our principal partners and channels and understand the direction of the industry in case we are missing out on anything and continue to create optimal environment to support their own operations. Our target is to do everything we can, gather information from where can including the user community on how to continue to operate on our platform. We look forward to a yearly event.