OPTIMISTIC that the current bank-led cashless initiative of the Central Bank of Nigeria (CBN) will not crumble, with the absence of telecommunications operators (Telcos) playing a major role in the exercise, Information Technology (IT) expert has said that the banks and the telcos would collaborate in the near future to further drive the initiative.
President/Chief Executive Officer of Winco Nixdorf, an Information Technology company, Mr. Eckard Heidloff, who was in Nigeria, recently gave the view, while responding to questions on the state of the country’s cashless policy.
According to him: “Although most countries that have successfully implemented cashless initiative, depended on telecommunications operators to drive the initiative, since they have the network and infrastructure on which cashless runs, but some other countries like Nigeria also implemented the bank led initiative, where the banks were authorised to drive the initiative.”
He, however, said: “Whichever approach any country adopts, the bottom line is to achieve result.”
In the case of Nigeria, where banks drive the initiative alone, Heidloff said that there would be likely collaboration between banks and the telcos, since the telcos had developed strong telecommunications infrastructure on which cashless was running.
Following agitations by the telcos that they were sidelined in the entire process of driving cashless initiative in Nigeria, the CBN had made bold to say it was a deliberate attempt to use banks in driving the exercise, for key strategic reasons that bothers on money handling.
The CBN had in January last year, commenced the implementation of the cashless policy in Lagos, and aimed at reducing the dominance of cash in the system.
Following its successful implementation in Lagos, the CBN, penultimate month, declared the extension of the policy to Rivers, Kano, Ogun, Anambra and Abia states as well as the Federal Capital Territory (FCT) from July 1, 2013. Since the extension, banks and the regulators have continued to intensify efforts in ensuring that consumers are exposed to the various alternative channels.
CBN had explained that the states were chosen because of the large volume of cash transactions in some of their major cities such as Aba, Kano, Port Harcourt and Onitsha.
Under the policy, the CBN pegged the daily cumulative cash withdrawal or deposit limit for individual accounts at N500, 000 per day and N3 million per day for corporate accounts.
However, to avoid the penal charges associated with withdrawing and depositing funds, banks have rolled out various electronic payment platforms to ease the burden associated with carrying cash.
Banks largely drive the process, a situation that has raised concerns among telecoms operators.