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Cashless policy: Don cautions on what could negate financial inclusion


Dr Aminu Usman, Head, Economics Department, Kaduna State University, has urged the Central Bank of Nigeria (CBN) to carry out robust campaigns to sensitise Nigerians to understand the need for bank charges on deposits and withdrawals.

Aminu, in a telephone interview with the News Agency of Nigeria (NAN) on Sunday, cautioned that the policy must be implemented in a manner that would not negate financial inclusion.

The CBN on Tuesday issued a circular to deposit banks to commence the implementation of the cash-less policy in six pilot states across the country.

The apex bank directed that implantation should commence from Sept. 18 in Lagos, Ogun, Kano, Abia, Anambra and Rivers States as well as the Federal Capital Territory(FCT).

It, however, stated that the nationwide implementation of the cash-less policy would take effect from March 31, 2020.


The CBN explained that transactions would attract three per cent processing fees for withdrawal and two per cent processing fees for lodgements of amounts above N500,000 for individual accounts.

Similarly, corporate accounts would attract five per cent processing fees for withdrawal and three per cent processing fees for lodgements of amounts above N3 million.

While acknowledging that bank charges on deposits and withdrawals would discourage people from cash transactions, Usman advocated for more effective and functional technology that would facilitate the implementation of the cash-less policy.

“What the CBN is supposed to do is to encourage people to use platforms provided by the banks because they have invested huge money in developing different platforms to make the cash-less policy seamless.

“However, Nigeria has a very large economy where transactions are dominantly cash-based.

“For instance, some village markets are very large and in those places there are no banks, so people transact most times in cash.

“Sometimes there could be a transaction of over N100 million or more, so if these people must be charged when they take the money to the banks to deposit, they would rather keep the money at home.

“Though the charges will help CBN implement the cash less policy and protect investments of banks in technology, the apex bank has to consider major targets.

“One of the targets is to enhance financial inclusion, people who are outside the banking system to be brought into the banking system,” he said.
Usman added:“But now that they are still trading in cash if you impose cash charges on them definitely they will not go to the bank.

“The policy is good for people in urban areas because what would people in such places carry cash for.

“So, CBN needs to create a lot of awareness to get better results.

“Also there is need to ensure more effective platforms; investments in technology must be enhanced because people are still afraid of Automated Teller Machines (ATM).

“Sometimes the machines would not work due to poor network, so addressing these challenges would increase the confidence of the people.’’

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