FG orders DISCOS to go cashless - THE BUSINESS PACKAGE


Wednesday, January 1, 2020

FG orders DISCOS to go cashless

The Federal Government has ordered power distribution companies to migrate to cashless settlement platforms with respect to collection of electricity bills from residential, industrial and commercial customers.

It stated that the distributors have till January 31 and March 31, depending on the class of customers, to comply with the order issued by Nigerian Electricity Regulatory Commission in a document with reference ‘Order No/NERC/183/2019.’

The document, dated December 30, 2019 andissued  in Abuja, was signed by both NERC Chairman, Mr James Momoh; and NERC Commissioner, Legal, Licensing and Compliance, Mr Dafe Akpeneye.

In the document, the commission noted that Federal Government issued a policy directive that required the mandatory transition of certain classes of end-use customers of Discos from direct cash settlement of bills to cashless settlement platforms.

It said this was in order to reduce collection leakages/losses and improve overall revenue assurance in the Nigerian electricity supply industry.

“The commission notes that this policy directive complies with EPSRA (Electric Power Sector Reform Act) and laws of the Federal Republic of Nigeria,” it stated.

It added, “The commission hereby orders that without prejudice to provisions of section 10 of the Meter Reading, Billing, Cash Collections and Credit Management for Electricity Supplies Regulations, 2007, all Discos shall transit to cashless settlement platforms for the billing/collection of industrial and commercial customers by 31 January 2020.”

The regulator stated that without prejudice to the provisions of section 10 of the cash collection regulation, all Discos should transit to cashless settlement platforms for the billing/collection of the R3 class of residential customers by March 31.

The NERC stated that all Discos should leverage available banking channels approved by Central Bank of Nigeria in complying with the directive.

It stated that all collection agents, super agents, sub-agents, payment solution service providers and payment terminal service providers engaged by Discos in compliance with the order shall be duly registered with both the commission and CBN.

The regulator further stated that all duly registered collection agents and other service providers should operate dedicated accounts strictly for the purpose of billing/collection of revenues from customers of the Discos.

To ensure a successful transition of customers to cashless settlement platforms, the commission said all Discos must promote the adoption of end-to-end electronic payments by all stakeholders in sector.

It said the power distributors should provide customers with appropriate bank account details and other approved channels for receiving/processing payments such as mobile money and electronic wallets.

It further stated that all Discos should ensure full accountability of energy flow with the installation of appropriate metering infrastructure integrated with the customer management systems of all industrial, commercial and the R3 class of residential customers by December 31, 2020.

“All Discos shall comply with the reporting requirements prescribed by the commission pursuant to this order,” the NERC stated.

It said the commission and the CBN or its delegates would monitor all third-party dedicated accounts for the billing/collections of funds from industrial, commercial and the R3 residential class of customers of Discos.

“This order supersedes, overrides, extinguishes all other forms of billing and collections from industrial, commercial and R3 residential class of customers of Discos,” the NERC declared.

The commission explained that Discos were the designated revenue collection agents for the power sector, stressing that failure to comply with the order would be treated as a breach of the terms and conditions of the distribution licence

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