Basic Principles in Formulation of Mega-PSPs Rules

With the entrance of new banks to this arena, current situation will be aggravated. Presently, the plan for setting up Mega PSPs seems necessary. For this reason, observing compilation and approval of Mega PSPs rules with Islamic banking principles, using previous national and international experiences in the field of banking innovations, and taking advantage of views of experts and economic activists to observe all the aforementioned cases are of paramount importance.

Advantages and Disadvantages of Localization of an International Experience

Possibility of direct connection of switch of these companies to SHETAB (Interbank Information Transfer Network) switch is one of the main necessaries and prerequisites behind establishment of Mega PSPs.     

Moreover attaining advantages like increase of speed and reduction of costs for fulfilling any transaction, suitable ground will be paved for offering consecutive services even at bank switches are disconnected.

This service will help increase of public confidence to e-payment service and also expansion of e-payment culture in the country. Of the other advantage of this system, parallel costs are prevented and will help increase of getting public accessibility to POS through collection of redundant and additional POSs installed in a store and installing them in more stores. Setting up Mega PSPs has also worried activists of this industry, the most important of which is can be referred to probabilities of damaging financial status of banks, small-scale PSP companies, reduction of quality of services in Logistics Affair, presenting new services and way of getting contact with customers due to the reduction of competition after centralization of PSP companies.

For solving this problem, supervising and controlling quality of presenting services and standardization of it by the CBI seems necessary.

Highlights of Mega PSPs Rules Compilation rules

It is highly proposed to:

1. Concurrent with the establishment of Mega PSPs and with the aim of preventing from re-notification of some opposite policies with the national interests and policies of the CBI, it is proposed that a joint cooperation committee, comprised of representatives of Mega PSPs, should be set up under strict supervision of the CBI with the aim of determining competitive rules and also setting macro strategies in various fields.
2. Correction of offering stocks of Mega PSPs through ceding to some banks and presence of representative of CBI at the Board of Directors of each of them, a specialized approach, obtained from years of experience of these companies on PSP industry of the country should be replaced with non-specialized and inexpert tastes imposed on these companies.
3. With direct guidance and supervision of the Central Bank of Iran (CBI), any type of spending parallel expenses and implementation of non-specialized and sectional policies should be avoided. However, necessary ground should be prepared for precise development of e-payment industry of the country.

Note: Upon execution of these proposals, Central Bank of Iran (CBI), moreover easing exertion of control processes, will access possibility of targeting and continuous study of degree of actualization of macro objectives of the country more than before.

From Mega PSPs to Materialization of Multi Acquirer  

Based on this plan, which require agreement among extant banks in the country, acquirer can settle funds as a result of selling his or her products and services to each of accounts opened at one of participating banks through owning one POS system. Under such circumstances, acquirer does not need having POS system of other banks. It is obvious that way of transfer of transaction will be set based on interests of each of present banks from among the models as predefined at the plan.

For this reason, PSP companies should convene with one another after setting up Mega PSPs and should activate within the framework of consortium of PSP companies. If the aforementioned aim is finalized, turning extant situation to the situation compatible with the international standards will be actualized.

Technical Specifications of Multi Acquirer Plan

Suppose that relevant bank which owns POS has installed a POS system in a trade enterprise and x and y banks intend to take service from POS system of the bank owning POS, under such circumstances:

POS, based on made agreement, dials up head number of the bank owning POS for all slot-drawn cards, details of which are guided towards switch of x and y banks through interface transaction switches. In other words, transaction has been carried out in switch of various banks and funds obtained from it are settled into the accounts of acquirer in each bank.

With the coordination made in this regard, POS dials up head number of bank x and also bank y for some others as well as head number of the bank owning POS system for some slot-drawn cards and finally, transaction is carried out according to the current procedures.

In the same direction, acquirer can get access account of all involved banks easily and can settle its fund into the relevant accounts.

Thanks to the commitment and loyalty of customers, it can be said that there is high possibility of drawing x and y banks’ cards at joint POS system of x and y banks as well.

At any rate, this process is expandable and can be regulated.

At the end, managing directors of banks of the country and senior managers of Iran’s top PSPs should pay due attention in determination of strategy of the banks and companies, under their management, and also should consider national and organizational interests. In addition, these responsible managers should pave suitable ground to share POSs, installed at various banks, with appropriate strategies.

Generally speaking, these managers should take their utmost efforts to gain customers’ satisfaction optimally coupled with nearing management of e-payment services according to the international level.

seyed Majid Mirkabiri,KiCCC CEO