The Federal Government of Nigeria has terminated its longstanding relationship with Remita, a payment solutions provider that facilitated government financial transactions for 13 years.
This comes as a big blow for System Specs, the parent company of Remita, which processed $30 billion annually in 2016 from transactions with merchants, billers, multinationals, Small and Medium-scale Enterprises, and governments at various levels.
Remita would be replaced by a new Solution known as Treasury Management and Revenue Assurance System, which goes live today, a memo signed by Oluwatoyin Medin, the Accountant General of the Federation read. To avoid a hard reset, Remitta would be phased out gradually in two phases.
The first phase begins today and shall cover payments and collection (Naira component only) and tax remittances. Phase two is expected to commence from June 1, 2025 and shall cover the collections and payments menu for FX component and integration to ministries’ ERPs.
The migration process is expected to be smooth. All current and active users on Remita have been granted automatic access to the new system using the same username and corporate ID on the former system. “Once any user is created, an automated email notification detailing the username and one-time password shall be sent. The system will mandate a change of the one-time password at first login,” part of the memo read.
The government has stipulated that only CBN-licensed Payment Solution Service Providers (PSSPs) approved by the Accountant General will be authorised to collect revenue on behalf of government ministries, departments, and agencies (MDAs). Additionally, contractors working with federal ministries must register with the Federal Inland Revenue Service (FIRS) to be onboarded with the new system. To enhance transparency, the system will also automate the deduction and remittance of internally generated revenue from federal agencies.
The termination of the Remita partnership is a substantial blow to System Specs. The company reportedly processed $6 billion in monthly transactions through its platform in 2020, including a significant volume of government-related transactions. While the company has demonstrated resilience in the past, including surviving a Senate probe in 2016, the loss of this major government contract will undoubtedly impact its revenue streams.
