Transforming card business in Nigeria

3Line Card management company Ltd was set up three years ago to bridge the gap in service delivery. In this exclusive chat with BusinessDay, the managing director of the company, Ademola Ade Ojo, explains the strategies the company has adopted in re-inventing card business in Nigeria.

The continuing improvement in the investment climate and the gradual upgrade of infrastructure backbone is creating investment opportunities particularly in the ICT sector. As such, there is an increased demand to reduce inefficiencies and boost productivity in the areas such as governance, payments and data collection as well as storage. In order to take advantage of emerging business opportunities in e-business, 3 line Card management Limited, a company set up in 2005 to design, operate and market world class card management, electronics payment and related infrastructure recently launched a hybrid 72K card in the country. The features of the card is exceptional and the first in the country. The company is a Card Management Company based in Lagos Nigeria but with a global view. It is all about providing e solutions that make a difference to every day life. Life is both personal and e-business- is dynamic and vibrant; the solutions the company offers are designed to fit into the fast , varied , mobile lives we lead in this country. According to Ade Ojo the managing director and chief executive officer, the company’s philosophy is to challenge the status quo, seeing how far the company could push the boundaries of technology to give us more. We want to see possibilities being made real. The company designs, builds, operates and markets world class card management, electronic payments (e payments) and related infrastructure and services. The company focuses on two key areas –ePayment, eData and eIdentity. Our eServices rely on the company’s card platform which is smart card based and licensed to operate in Nigeria under the Freedom Card brand name. Our card platform is multi-payment, multi-functional and multi channel enabling, for the first time in Nigeria, a card which has both online and offline capabilities as standard features. This means that by supporting your card with our platform, you and your customers can conduct more transactions of different types with one card than has been possible before now in Nigeria. In combination with an in house card management system and a terminal Management System, our Technology can manage the entire lifecycle of your card from procurement to fulfillment and implements online & offline debit and e Purse transactions.

Uniqueness of its products For the card holder, Freedom card offers a wide range of very robust, very convenient features that come as standard functionalities in all. Any of these features an be activated on request for a card issuer. It is also a high capacity 72K cards that are hybrid in nature, having both the chip and magnetic stripe technology to enable both online and offline transactions. Unlike other products in the market, the multipurpose Freedom card could also be used as an identity and e-payment card in the country. The company’s card management system is Euro, MasterCard and Visa (EMV2) compliant working on the VisaSmart Debit Credit application system (VSDC+), Java based technology with an end to end solution that allows financial and non-financial institutions offer electronic revenue collection, payroll processing and data capturing. The company says its schemes meet all standard regulatory requirements such as Know –Your-Customers KYC guidelines. It is also compliant with all local and international regulations as well as complies with best practices, risk and security management frameworks. With Freedom cards connectivity issues are a thing of the past since the cards have online and offline capabilities. The card comes with both a chip and the more common magstripe feature enabling the card holder to load money on the chip for offline spending or to go online and access from an account. Now the card holders can the unique convenience of carrying only one card as both an electronic purse and a debit card. As well as taking cards from the ATM, Freedom cards allows you to collect cash from a merchant outlet after purchase is made or even without making any purchase at all. The card holder has more avenues through which to access his funds as now every point of contact offers the possibility for cash dispensing.

Other company products Our ePayment solutions cover the procurement and management of smart cards for banks, corporate bodies and government entities. With the company’s advanced technology, cards on its platform can allow customers access to both epurse and debit card services, Automated Teller Systems ATMs and Point Of Sale POS use, bill payment and cash back as well a local & international funds transfers functions. Combining both magstripe and Chip PIN systems, our cards offer a more secure means of payment processing and management. The Chip & PIN system is internationally recognised as a more secure method of identification and authorisation for payment cards, bringing our clients and their customers in line with the rest of the world in terms of the latest security features.

Synergy with Lagos state government The versatility of our cards facilitated our partnership with the Lagos state government for the automation of its licencing process. This is because our cards allow for multi-bank, multi-currency functions which enable card holders with multiple accounts to access their funds in 3 different accounts from a single card and pay for goods and services in foreign currencies ( EURO, POUNDS, and Dollars). What we have is closed to what the licencing authority does. We have a partnership in the autoreg project. You know that in the past people will have to go to the local government licensing offices for the registration of their cars. The system then breed touts and there were all kinds of irregularities. But now, the autoreg project makes things much easier. Apart from the assurance that the states money is safe, autoreg has made it possible for data, data that would be needed for long term planning. We can now tell you the number of vehicles on Lagos roads, trucks and cars, colours and make. These are the advantages of the project. Again, what they were doing was that they were using scratch cards. You go to the bank you pay then they issue you your documents. That was before we came on board. But now autoreg has gone smart and has brought innovations that have never been seen in the country before. Now, each time you are going out with an autoreg card that card contains special features which include information on your vehicle number, chasis number and information on the colour of the car. As I said, the company’s cards are acceptable at a wide variety of merchant outlets for various uses as well as via POS, ATMs, the Web and Mobile Phones. 3 Line is continuously looking forward by developing its technology and increasing its reach in the hope of bringing even greater features and convenience to its clients over time. E- payment solutions offered to government include Organised Transport Payment systems, Duties and Taxes Payment systems. Another important quality of the card is that with the dearth of Data and information in Nigeria, 3 Line is positioned to offer Data Capture Solutions enabling the automated capture of information/ records for educational institutions, the Government and corporate entities. 3 Line Freedom cards can also be used as identity cards for Higher institutions that need to place key information on a card for later analysis; the mobility and quick down load capabilities built into its technology offer fast , accurate and simple way to keep track of staff, customers or students. High security features are built into the data-capture cards to protect privacy and deter fraud.

Future of Card Business in Nigeria Demographic figure shows that there are about 55 million Nigerians within the working group. These include those in the formal and informal sectors of the economy. If all these people have cards and they are all doing about N8 000 per. Simple Arithmetic shows that they will be making about N165 billion annually and this is just in transaction fees alone. Then if you consider the cost of the cards which is put at about N200 and other non financial transactions you will discover that the future of the business if very bright. My estimate is that the market is worth about N250 billion and still counting.
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Lagos State Migrates Vehicle Registration Management to Freedom Card Platform

Lagos State Government has commenced the migration of its automatic vehicle registration management, known as AutoReg to Freedom Card payment platform, which is managed by 3Line Card Management Limited.

The migration followed the strategic partnership between 3Line Card Management and Courteville Investment Limited, owners of the AutoReg trademark. The scheme which is hitherto operated on scratch card platform has now been moved to a more robust smart card platform capable of carrying out other financial transactions immediately and in the nearest future.

The new platform is a smart card that contains a memory chip and can perform the functions of a debit card, credit card, prepaid card and other future transactions such as payment for gasoline and payment for lottery.

Under the new scheme, vehicle owners in the state are required to register their vehicles by visiting registration centres, which are the branches of banks involved in the scheme. Oceanic Bank is the first bank in the country that issued the Freedom card and AutoReg co-branded cards to vehicle owners.

At the media launch of the new platform last weekend, Dr. Cecilia Ibru, Chief Executive Officer of Oceanic Bank said the bank was proud to be associated with the project, saying, "It is part of our commitment to co-create value in e-governance with the Lagos State government."

According to her, Oceanic Bank has consistently been the lead bank amongst other banks involved in the AutoReg scheme. "We are devising more innovative ways and methods for vehicles owners to derive maximum benefits from the upgraded scheme."

While explaining the multi-functionalities of the AutoReg new platform, Dr. Ibru said that the traditional vehicle owners' details would be electronically stored in the cards for the purposes of verification by government agencies.

In addition, the card can be used as a debit card or electronic purse for existing customers of the bank, and electronic purse for non-customers that do not operate any bank account. "This is done through the creation of a virtual account for such customers. Money is stored electronically on the card, which can be used on ATMs; point of sale (PoS) terminals and on the web."

In his remarks, Bola Akindele, Chief Executive Officer of Courteville, the owner of AutoReg trademark disclosed that the scheme, which commenced one year ago, has increased the state's revenue generation by 300 percent and created a million records of vehicle owners in the state. Akindele said the scheme has also eliminated problems hitherto associated with obtaining vehicle licenses such as touting, corruption and delay associated with manual vehicle registration. "Now, it takes only five minute to capture a registration process through the AutoReg scheme. It is a home-grown scheme and the first of its kind in the world."

Akindele said his company decided to work with 3Line Card Management in order to move the AutoReg scheme to the next level and eliminate all others limitation associated with the scratch cards platform. "We choose 3Line Card because out of all the card companies that approached us, 3Line Card has the best infrastructure that can handle all our requirements".

According to him, with a 72k chip, the highest data storage capacity in the market, AutoReg Freedom cards capacity is limitless. "We envisioned that in the future, vehicle owners would be able to use their AutoReg Freedom Card for payment services such as buying goods at supermarkets, payment for tolls on Lagos roads, payment for fuel at filling stations across the state."

Demola Ade-Ojo, promoter and managing director of 3Line Card Management said the AutoReg Freedom card is a multi-application as well as multi-platform compliant. "AutoReg Freedom card would be accepted on all payment platforms in the country. We are working with VISA and InterSwitch in this regards." He said with this kind of innovations, Nigeria could begin to take her natural position among nations that have eliminated waste, corruption and bureaucracy using cutting edge technologies.
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3Line Limited rolls out e-payment products

3Line Card Management Limited, an electronic payments firm set up in 2005 to design, build, operate and market world -class card management has made first move towards realizing its vision of providing a dynamic e-space using a card platform as it recently introduced a market friendly payment card brand into the Nigeria market, one of which is christened FreedomCard.

FreedomCard will be licensed to 3Line's strategic partners, members and organizations and as part of managing these brands, 3Line is well positioned to provide its financial institution customers with sophisticated set of information and transaction processing services while establishing and enforcing rules and standards surrounding the use of its card and payment systems.

3Line is set to offer e-services, using multi-payments, multi-purpose smartcards and strengthen client relationships by "going wherever they are, optimizing their transactions, ultimately participating actively in the consummation of a significant percentage of heir transactions. Also the cutting edge technology for e-services and the retail solutions provide a wide range of services acceptable in a wide range of channels such as Point of Sale (POS), Automated Teller Machines (ATMs), web and mobile.

3Line has the capability for back-end management of smart cards using a multi-application, multi-channel electronic and mobile payment platform. Our card management system (CNS) is working on a java based technology with an end to solution that allows financial and non-financial institutions offer electronic revenue collection, payroll processing and data capturing.

The FreedomCards, apart from the special use to which they may be employed such as data capture, vehicle registration and so on, have the capability to ease the inconveniences of every day life and are able to do the following: ATM withdrawals, online offline payments at POS terminals and electronic funds transfers.
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3LINE CARD MANAGEMENT EXPERT LISTS BENEFITS OF ROBUST E-PAYMENT INFRASTRUCTURE.

A robust card culture in Nigerian economy will prevent leakage, as well as standardize financial processes that would bring monies outside the financial sector into the formal system.

The Managing Director of 3Line Card Management Limited, expressed this view in an interview with The Guardian, shortly after the media launch of its e-product in Lagos. Stating that the growth of GSM industry had raised hopes that there is a lot of cash outside the system, He said that, by the reason of the growing interest from international players, the country should expect an explosion of e-payment services in the years ahead.

Reeling out statistics to buttress his point, the 3Line boss said that transactions done via cards on the Automated Teller Machines and the point of sale (POS) Terminals in 2006 alone was worth N460 billion.

"Again, when you look at what happened during the strike, a lot of transactions were done on ATMs as the only means of having access to your money. We need e-payment; we need to move ourselves to where the rest of the world is," he noted.

According to him, government's efforts in encouraging e-payment-data and e-identity for purposes of gathering information complement the on-going private sector initiative to drive e-services in the country.
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3Line positions to make a difference in the card sector

At what point will Nigeria become a cashless society? When less business can be done with cash and more emphasis placed on the modern card technology which is safe, person specific and even trendy?

Most people are yet unable to relate with the technology, for reasons that have to do with security and fraud, among others, while some obliviously just feel great caring loads of cash on them.

"One of the reasons the card business has not been very successful in the country is that we have not been able to give a compelling reason why people should carry cards. This is one of the reason we have decided to come out to make a difference with online and offline transactions. We want people to transact business when there are no online transaction." said The Managing Director as he spoke about his company's plan to make a big impact in the market.

What 3Line hopes to achieve is to provide a total solution for implementing online and offline debit and e-pursue transactions. As an Organisation its focus is on providing smart card offering to the under- banked segments of the economy through strategic partnerships.

The entry point into the market is FreedomCard, one in a family of well accepted cards which the company plans to license to its strategic partners, members and organizations.By way of managing these brands, 3Line is well positioned to provide her financial institutional customers with sophisticated sets of information and transaction processing services and establish and enforce rules and standards surrounding the use of the card and payment systems.

With over a billion naira worth of investment in the bargain, The Management informed HiTech that 3Line was not after competition but out to provide a robust, world class platform to make a difference in the ePayment sector.

The potency of the technology, according to his explanations, lies in the hybrid nature of the 72k smart cards which feature both an integrated circuit or chip and a magnetic portion giving it dual functionality for both offline and online use.

The smart cards contain software and permanent data engraved into a non-volatile memory. The embedded chip enables considerably greater security than is possible with cards featuring only magnetic-stripe technology.

Making a declaration, the MD said; "3Line will offer integrated e-services, using multi-payment, multipurpose smartcards. 3Line operation is very simple - we shall strengthen our client relationships, by going wherever they are, optimizing their footprint and helping them capture transactions, ultimately participating actively in the consummation of a significant percentage of their e-business transactions. Our corporate solutions are at the cutting edge of technology for e-services and the retail solutions provide a wide range of services in a wide range of channels such as Point of Sale, ATMs, Web and Mobile."

In the product line up is: e-Banking, e-Government, e-Health and Loyalty Programmes. The MD vowed that in all these areas, the robustness of the 3Line platform will allow the company to make a difference in the emerging card sector.
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3LINE, VALUCARD, OTHERS DEEPEN E-PAYMENT SECTOR.

3Line Card Management Limited, an e- payment system solutions provider, has announced a partnership with Nigerian Sport Lottery (NSL).ValuCard Nigeria plc and Ingenico through a Memorandum of Understanding (MOU) signed in Lagos last week that will expand the electronic payment sector.

The MOU provides that the alliance between the Nigerian Sport Lottery, ValuCard Nigeria plc and ingenico will go a way to accelerate economic growth and integrate Nigeria with the rest of the world especially payment collection and storage of data which is critical for accurate economic planning.

The Managing Director, 3Line Card Management Limited, commenting on the development, said "There is no doubt that the movement to e-payment systems has a significant number of benefits". He noted that the MOU will also introduce the companies to the investment opportunities available in Nigeria especially in the fields of e-payment.

Highlighting the benefits of electronic system of payment to the economy, he said e- payment reduces the costs inherent in a high cash economy, which includes cost of printing, minting, distribution, security among others. In fact survey statistic show that countries moving towards e-payment realized cost savings equivalent to at least one percent of their Gross Domestic Product (GDP).This savings could be more ,in an inefficient cash economy such as Nigeria, he added.
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E-PAYMENT TO REDUCE NIGERIA`S UNDERBANKED N30tr -

Card management business are set to capture a reasonable proportion of the over N30 trillion huge reserve of funds outside the banking system. It is also estimated that over 70percent of Nigerians conduct their business transactions outside the banking sector.

Disclosing this to Business Day, The Managing Director of 3line Card Management Nigeria Limited says banking will soon be taken outside of the brick and mortar banking halls to capture the huge reserve of funds in the informal sector.

He spoke at a ceremony to mark the signing of a memorandum of understanding between the Nigerian Sport Lottery, ValuCard Nigeria plc and ingenico.

The MOU provides that the alliance between the Nigerian Sport Lottery, ValuCard Nigeria plc and ingenico will go a long way to accelerate economic growth and integrate Nigeria with the rest of world, especially with respect to payments collection, and storage of data critical for accurate economic planning.

The signing of the MOU also seeks to introduce these companies to the investment opportunities available in Nigeria especially in the fields of e-payment investment.

In his words," There is no doubt that the movement to e-payment systems has a significant number of benefits. First, e-payment reduces the cost inherent in high cash economy, e.g. cost of printing, minting, distribution, security etc.

In fact, survey statistics show that countries moving towards e-payment realized cost savings equivalent to at least one percent of their GDP. The savings could be more, in an inefficient cash economy such as Nigeria.

Second, e-payment are known world wide to make for easier data gathering which provides economic planners and policy makers with accurate information.

Thirdly, there is a clear reduction in graft with the employment of e-payment solutions. KPMG established in a study that the UK government saved up to 70 percent on procurement cost s by moving to an e-payment infrastructure running on a VISA platform.

"Finally, it is a well known fact that the absence of an e-payment system encourages the holding of cash, a situation which significantly reduces the money available in the economy for re-investment, thus reducing economic growth and increasing interest rates due to the attendant artificial scarcity of funds". Oluwasanmi said.
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Going the e-way

Electronic transactions in the country receive a boost with the launch of 3Line card management services.

There was a sudden hush as the lights were switched off. The small group assembled in the room formed a long chain of interlinked hands, eyes firmly shut and faces held up in deep concentration. In the background, R. Kelly crooned his monster hit, I Believe I Can Fly. The occasion was a get-together of staff and management of 3Line Card Management Limited, a smart card chip technologies company, to celebrate its newly acquired license granted by the Central Bank of Nigeria, CBN. But hold It! The scene just played out was not a séance session but the management's way of gingering the staff to square up for the challenges ahead, as it launches into full operation.

Established in 2005, 3Line was set up to design, build, operate and market world-class card management, electronic payments,,e-Payments, and related infrastructure and services in Nigeria and globally. Valued conservatively at N12.5 billion ($100 million), the company's card business is smart card- based. In the first phase according to management, 3Line aims to be a total solution for implementing online and offline "debit and e-Pursue" transactions. The company's focus during the first phase also would be on providing smart card offering to the under - banked segments of the economy, which it said make up over 70 per cent of Nigeria's population.

3Line is also ready to provide e- Payment services for low and high -value transactions, full risk management needs, third party card transaction processing via point of sales, POS, terminals, automated teller machines, ATMs, and other pervasive media like mobile phones and the internet. The company's strategic objectives are reflected in its mission and vision statements: to be the second largest driver of services, second only to the internet and to provide a dynamic e- Spacing using a card platform.

Urging 3Line staff to believe in and show a sense of commitment to the company in order to rev up for the task ahead, Demola Ade-ojo, vice Chairman of the firm, narrated the build-up to setting up 3Line, the vision and conviction of the need for such a venture, he expressed joy and relief that the company had finally begun the journey, And for many others, the entry of the company into the electronic card business will further promote electronic transactions in the country.
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