Petroleum Equalisation Fund (Management) Board
The Petroleum Equalisation Fund (Management) Board is a scheduled parastatal of the Ministry of Petroleum Resources, established by the PEFMB Act to equalise the cost of transporting petroleum products from depots to Marketers sales outlets (filling stations).
What do customers of petroleum products in Abuja, Ogori Magongo, Yenogoa, Maiduguri and Lagos have in common?
They all have the same pump price at their petrol stations
The organization that makes this possible, is the Petroleum Equalization Fund (Management) Board PEF(M)B.
PEF(M)B is a parastatal of the Federal government established by law to equalize the cost of transporting petroleum products from products' depots to filling stations. This is to ensure that petroleum products are made available at uniform prices throughout Nigeria.
To operate the price equalization mechanism, marketers whose petrol stations are located close to depots contribute to the Equalization Fund while marketers with petrol stations farther away from depots claim from the Fund. An agreed matrix by all stakeholders is used to determine:
- Marketers who have to contribute to the Fund and how much
- Marketers who have to be reimbursed and by what amount
This statutory role of PEF(M)B places on her the burden of making payments to about 10,000 different service providers on a regular basis. Managing such a large number of payment transactions can be a huge challenge to any organization in terms of time, logistics and human resources as PEF(M)B soon realized.
Some of the numerous challenges PEF(M)B had to contend with in operating a manual payment process include:
- Thousands of cheques that had to be written, with each requiring multiple signatures, thumbprint, endorsement on both sides and several letters of confirmation to be attached before it could be processed. This made cheque signing a disruptive, distractive, intrusive and irritating part of top executives’ usual routines.
- Each cheque required a payment voucher and PEF(M)B had to maintain mountains of vouchers which could get misplaced so easily.
- Delays in crediting marketers’ bank accounts due to typical clearing and banking operation issues. In some cases, PEF(M)B bank accounts were not debited while clients were not credited in a timely manner leading to enormous reconciliation challenges.
- Absence of a reliable and timely feedback mechanism from banks in respect of authorised payments. PEF(M)B also had to maintain cumbersome multiple feedback mechanism with each bank where it had an account. It was impossible to have a real-time snapshot of account balances at any point in time.
PEF(M)B attempted to address these numerous payment challenges using different approaches at different times. At some point, PEF(M)B engaged some banks with advanced technology platforms to solve the problems but still did not yield the required results. Working directly with settlement institutions did not fare better either. In order to overcome these challenges once and for all, PEF(M)B decided to seek out a proper remittance management solution.
The main objective of this move was to help PEF(M)B put in place a more efficient and effective solution that guarantees sustainable success in the management of historical challenges. As an organization with accounts in many banks, PEF(M)B was looking out for a solution that would help:
- Eliminate the need to master and operate multiple e-Payment platforms offered by each bank where an account is held.
- Eliminate the need to have funds tied down by a single bank because it was offering “free e-Payment solution”.
- Ensure instant feedback is obtained in respect of success or failure of any transaction.
- Ensure that any transaction can easily be tracked for as far back as possible without recourse to administrative bureaucracy.
The above represented key selection criteria, set by PEF(M)B in evaluating and selecting a payment processing and remittance solution.
Remita - a funds and schedules remittance solution delivered by SystemSpecs was one of the short listed solutions. Other short-listed options included e-Payment solutions offered by some commercial banks.
To ensure a successful exercise, PEF(M)B management's approach to the solution evaluation and selection process was rigorous, inclusive and transparent in order to avoid past experiences.
At the end of the exercise, Remita was unanimously selected for its incredible robustness, ease of use, flexibility, and unique ability to support payments to several accounts in the same or different banks on a real-time basis.
Other distinguishing features of Remita which set it apart from other options and endeared it to PEF(M)B include functionality that ensures;
- You can see all your bank account balances on just a single screen
- You can view full historical or current statement in respect of any or all payments made or received across all banks - Yes across all banks!
- You can replicate your existing mandates, payment approval processes, authorizations and limits electronically
- You can send notifications and details of payments to beneficiaries via SMS and email
- You can maintain a single high security personal profile to access all your bank accounts
Speaking on Remita implementation, Munir Umaru Baba, General Manager Finance & Accounts PEF(M)B and the Project Coordinator, said “We began to make effective use of Remita within days from the time SystemSpecs was given the go-ahead by our management.”
Change and Remita Effect
“Staff of PEF(M)B Finance and Accounts department feel very comfortable with Remita and are excited about the relief it has introduced to their routine operations”. Speaking further, Baba said “With Remita we have breathed a sigh of relief. Core departmental functions are now being faced unlike before when we had four people at a time sitting at the Central Bank of Nigeria (CBN) for weeks waiting for cheques to be confirmed.”
A final word from Mrs. Kasali, the Executive Secretary: “We are extremely pleased in partnering with Remita.”
About Remita - One Stop Funds and Schedule Remittance Solution. Remita, from SystemSpecs is an electronic courier service that rides on secured e-payment platforms to deliver funds to bank accounts and associated schedules to relevant bodies. Remita enables schedules delivery and notifications to beneficiaries, at the click of a button.
With Remita, you can pay your vendors, suppliers and staff salaries. You can also remit pension contributions and associated schedules of your employees to their respective PFAs & PFCs. In addition, you can remit different taxes, health insurance, national housing fund, union dues, cooperative payments - all from the comfort of your office. You can also issue & monitor standing orders, authorise and monitor payments from remote locations, check all your different bank balances on one screen, trace and Investigate payments made, all these in real time.
About SystemSpecs - SystemSpecs commenced operations in 1992 and is today Nigeria’s leading provider of payroll, HR and financial management software solutions. With HumanManager and SunSystems in over 200 sites within and outside Nigeria, SystemSpecs is extending and establishing her leadership in the e-Payment arena with Remita.