Money transfer and cheque usage in Nigeria made easy


Ever wondered how you are able to cash your cheque in your bank no matter the bank from which it was issued? Cheques have to clear and be cleared – how and when they clear is a function of the system, but more especially the country.

The technical term is T+X, where X is the number of days it takes for the CHEQUE to get become money to be used for that financial transaction.

Have you ever wondered why you are asked to wait 24 hours before you receive value or why you can withdraw at any functioning ATM point? Well, all this has been facilitated by NIBSS using a software portal called NACS.

Late in 2017, the Nigeria Inter-Bank Settlement System [NIBSS] and Precise Financial Systems Ltd [PFS] collaborated to unveil a new National Automated Clearing System [NACS], which allowed all the Deposit Money Banks in the country to clear cheques in hours – achieving T+0.

Before 2013, X was at least 14 days but the introduction of NACS from Precise Financial Systems in 2017 changed the whole game.

A very important index in the ‘Ease of doing business’ [EOD] is the impact of a quicker process of clearing/processing of Automated Clearing House (ACH) instruments, which ensures businesses can run faster. #NACS

What are NIBSS and NACS?

NIBSS is the Nigeria Inter-Bank Settlement System PLC while NACS is

Nigeria Automated Clearing System (NACS), used to describe the automated clearing system of the entire banking and financial institutions in Nigeria.

It is a bank service system solely for the purpose of balancing, settlement and reduction in the process time in order to offer topnotch service for clients. It also made possible Cheque Truncation System where physical clearing materials are replaced with electronic ones.

How does it work?

It has been established that NACS is a service system and we might be wondering how this service system works? A typical example of how this service portal works is when you have two clients – Client A and Client B.

Client A uses Access bank and Client B uses Eco Bank, client A issues client B an Access bank cheque to be effected in Client B bank (Eco Bank),

How will Eco Bank get the cheque value without visiting Access Bank?

This service system is made up of sub-services one of which is Automated Bulk Clearing (ABC). ABC is an avenue through which funds transfer instructions of corporate and institutional customers of banks, which have been captured electronically as a single file, are presented or delivered by banks to NIBSS for processing at the Automated Clearing Session.

This is where NACS comes in. NACS simply creates an interface/balance between the two banks hence debiting the issuer account and crediting the receivers’ account. The i-TellerCH application from Precise Financial Systems Ltd has enabled NIBSS to achieve real-time processing and instant delivery of truncated cheques, prompt reports generation, easy access to archive images and general increase in cheque processing time amongst other benefits.

Likewise, on an hourly basis, customers of banks issue several instructions to their bankers to debit their accounts and credit respective beneficiaries irrespective of the bank.

ABC can be categorised into two processes – the credit process (Automated Direct Credit), which resolves the issue of bulk crediting of various bank accounts holder, and the debit process (Automated Direct Debit), which resolves the issue of debiting the issuer account.

What are the advantages of NACS?

1.  It reduces the processing time of issued bank cheques.

2.  The service system is tractable i.e. easy to use and understand.

3.  It maximises both the customer and service provider’s time.

4.  It’s creates a balance between different banks hence reducing confusion and possible settlement issues that may arise.

5.  It minimises waste in form of human energy, time etc.

NACS was introduced in the year 2006 and so far it has proven to be one of the major settlement service system in the banking industry. However, various modifications and upgrades have constantly been made to the software running the system but this is done in the best interest of all NIBSS’ clients for the sole purpose of making banking and cash transactions more efficient, effective and easy to use.

“The quest towards enhanced operational efficiency and improved service delivery through [using] continuous automation of most of our platforms at a [to reduce] reduced cost to the Nigeria financial industry and the drive to promote local products and enhance the country export commodities in the area of off-the shelf software solution sales were major factors responsible for the change from ECPIX system to i-TellerCH application,” said the Executive Director, Technology and Operations, Nigeria Inter-Bank Settlement System (NIBSS) Plc, Mrs. Christabel Onyejekwe.

In conclusion, the world is moving towards having automated institutions and the banking/financial industries cannot not left out. The deployment and implementation of NACS is a solid proof of the constantly changing world.


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