Implications of Introducing Cashless Policy in Nigeria
- January 13, 2019
- Posted by: RSIS
- Category: Social Science
International Journal of Research and Innovation in Social Science (IJRISS) | Volume II, Issue XII, December 2018 | ISSN 2454–6186
Ajugwe Chukwu Alphonsus Ph.D
Abstract:-Cashless policy is necessary for the development of efficient payment system, which induced efficient and seamless transmission of funds from one individual to another and from one sector of the economy to another. It also leads to deepening of financial market, which will ensure a sound and resilient economic development in Nigeria. The central pillars of cashless policy are financial inclusion and financial literacy; the financial inclusion encourages the unbanked to open accounts with various banks while financial literacy enlightens the citizens the importance of opening accounts with the banks.
The policy will be technologically driven by the application of e-banking processes, therefore such core banking technologies that will be deployed to drive the scheme will be examined, the merits and demerits of cashless policy will also be analyzed and recommendations will be highlighted as well.
The main exchange of value in Nigeria is cash and in the form of Naira. Emphatically stated, Nigeria is cash based. People prefer to transact their businesses with cash, rather than any other form or mode of transaction. Despite the effort of the Central Bank of Nigeria (CBN) to reduce the use of cash to bare minimum, cash continues to be a dominant factor of transaction in Nigeria. The introduction of cashless policy in Nigeria is timely as the use of cash will be minimized. The need for this scheme is for Nigeria not to be left behind in the ever changing technology, when the means of payment are now being dominated by e-payment in the developed countries.
Cashless Policy facilitates digital mode of payment and transfer of value and discourages the use of cash in financial transactions. It is technological driven. Yaqup J.O,(2013) et al further observed that the following among others enhance the functioning of cashless economy; e-finance, e-banking, e-money, e-brokering, e-exchange, etc.