By Udeme Clement
The cashless policy which the Central Bank of Nigeria (CBN) says begins in June 2012 but has now been brought forward to start in Lagos in December 2011 has been endorsed by the World Bank But while some financial experts insist that the new policy limiting withdrawals by individuals to N150,000 and corporate organisations to N1million per day would make Nigeria a cashless economy and further bring credibility into the financial system, others argue that the country is not ripe for a cashless economy. Some of the experts spoke to Sunday Business.
The new policy if properly implemented would check fraud and other sharp practices common in the banking industry: Mr. Mark Dehkpah, a top official, Ministry of Finance, Liberia: I believe the new cash policy is designed by the apex bank to enhance its monetary policy on Mobile Payment Policy, which the bank said would also take effect from June 2011.
The CBN Management under Malam Sanusi Lamido, is trying to bring professionalism into the banking industry in Nigeria by introducing monetary policy that would bring credibility into the system.
For instance, the Mobile Payment Scheme would be in operation any moment from this month, which is the same period the new cash policy would begin.
So, the initiative by the apex bank to make Nigeria a cashless economy is a welcome idea because it would create efficiency in the system. The new policy if properly implemented would check fraud and other sharp practices common in the industry.
The new cash policy is a good initiative, but at this point there is the urgent need for CBN and commercial banks in the country to also tackle the problem of confidence crisis in the banking sector.
This implies putting measures in place to ensure that a depositor’s money is refunded wherever there is financial crisis, or a particular bank is in distress. This would make customers to have strong confidence in banking industry.
The apex bank as well as other commercial banks should come together to decide whether a depositor’s money should be refunded in full or not.
The new cash policy would bring sanity into the banking industry: Mr. Santigie Charles Conteh of the Ministry of Finance Sierra Leone: The new cash policy would bring sanity into the banking industry. It would further promote accountability and good governance.
The endorsement of the policy by IMF should be seen as a positive development, because it would enable Nigeria achieve its Vision 2020 target. People should look critically at the long-term economic benefits that the policy would bring rather than just criticising it.
We must appreciate the fact that the on-going reforms by CBN had restored sanity into the banking industry in Nigeria . For instance, commercial banks are now focusing more on core banking to ensure efficiency in the financial system, which is good for a developing economy to ensure long-term and sustainable growth.
The Federal Government should not allow the World Bank to control our economy: Dr. Godwin Oyedele Oyediji, former chairman, Agriculture, Non-oil Export Trade Group, Lagos Chambers of Commerce, Industry, Mines and Agriculture. For instance, IMF recently advocated for devaluation of the naira, which I believe was not in the best interest of our economy.
IMF officials gave similar suggestion during the administration of the former military head of state, Ibrahim Babangida, and the outcome was a disaster for Nigeria .
The idea brought about a huge damage with negative consequences to the country and up till now, the economy has not fully recovered from that policy. If CBN wants to make Nigeria a cashless economy, the idea is good, but it should not be implemented overnight.
The apex bank should implement the policy systematically by first enlightening the entrepreneurs and the public on the benefits of running a cashless economy.
The CBN’s policy of cash withdrawal limits would curtail money laundering in the economy: Mr. Charles Akinsete, a financial analyst and the First Vice Chairman, Nigerian Association of Industrial Pharmacists.
The CBN’s policy on cash withdrawal is a good idea because the policy aims at making Nigeria a cashless economy like what is obtainable in advanced economies. We have made Nigeria a cash economy, which in a way has encouraged fraud and robbery.
For instance, someone would travel from Lagos to Abuja with N10 million for a business transaction, which could easily be done on-line and the transfer of money from one account to another within a short time.
The policy would help to curb corruption, money laundering and fraud. It would make the issue of cheques to be credible. People would not just issue cheques unless they have money in their accounts.
It would take away so much cash from the system. It would bring credibility to our money transfer system, respect to the banking system and it would make everyone fall in line by being a customer to the bank.
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