Cashless policy and contradictory fiscal policies punch. In the light of the foregoing, the introduction of the cashless policy by the central bank of nigeria cbn is applauded as a policy package with bountiful benefits as it seeks to encourage cashless payments, thereby arresting some of these cash related vices. Large volumes prosperous for nigeria considering rapid economic ofcash need intense security and transportation is growth. Effect of cashless monetary policy on nigerian banking. It prescribed a cash handling charges on daily withdrawal above five hundred thousand naira n500,000. Nigerias cashless policy better than cash alliance. The impact of central bank of nigeria cashless policy in. Cashless policy could often be affected by physical challenges such as high rate of illiteracy, inadequate sensitizationeducation of the benefits of cashless policy, and inadequate logistics such as the provision of internet connections in commercial areas, computers and point on sale pos machines. Effect of cashless policy on small and medium business in nigeria. This article examined development and challenges of cashless policy in. However, the cbn launched the cashless policy to save banking time, reduce the high. Full project the impact of the cashless policy on economic.
Nigeria is not left out of this trend as the cashless policy is the latest innovation of the central bank of nigeria, among its numerous efforts to reform the nigerian financial system. The main reason for the policy was to reduce the amount of. To examine the various challenges associated with the implementation of the cashless policy banking. Department banking and finance, faculty of management sciences, ekiti state university, adoekiti. The central bank of nigeria cbn introduced cashless policy in april 2011 with the objective of promoting the use of electronic payment channels instead of cash. Therefore, nigerian banks should utilize the benefits of the cashless policy and engage in efficient financial intermediation for enhanced bank profitability. The central bank of nigeria cbn has suspended its earlier directive on the implementation of cashless policy.
There are several complaints from different quarters that sufficient facilities have not been provided to make the system smooth. The study, impact of cashless economy in nigeria, focused on the three major categories by which nigerians can be divided traders, students and civil servants. The central bank of nigeria cbn has introduced a new policy on cashbased transactions which stipulates a cash handling charge on daily cash withdrawals or cash deposits that exceed n500,000 for individuals and n3,000,000 for corporate bodies. The cashless policy in nigeria international journal of humanities. Pdf impact of cashless economy in nigeria researchgate. The mechanics of the cashless policy in nigeria the cashless i nitiative is a n alternative to cash transactio ns through electronic means usin g information and communications technology ict. Specific objectives of the study is to examine the impact of the cashless policy on economic growth of nigeria. Preface why the central bank of nigeria made the cashless policy. The policy was introduced by central bank of nigeria cbn in december 2011 and was. The effect of cashless policy of government on corruption. The central bank of nigerias cashless policy in nigeria. Recommendation for policy makers and conclusions are presented in section 6. It is in this regard that the central bank of nigeria cbn introduced the cashless policy with the objective of promoting the use of electronic payment channels instead of cash.
Effect of cashless policy on small and medium business in. The introduction of the cashless policy by the central bank of nigeria cbn attractedreactions from different quarters due to what some scholarscalled hasty implementation. This was disclosed in a circular released on thursday, and. The nigerian financial system has always had a huge informal sector resulting in financial dualism with its attendant consequences including prevalence of cash transactions. Further, appropriate infrastructures such as improvement on the power sector should be made to enhance the smooth operation of the policy. An exploratory study musa abdullahi bayero bayero university kano, gwarzo road kano, kano, nigeria abstract empirical studies about. Effect of cashless policy on small and medium business in nigeria with abstract, chapter 15, references and questionnaire. As part of our ambition to be one of the best 20 economies before the year 2020, cbn informed the world that nigeria would commence the process of changing to a cashless economy by january 2012. Cashless economy is an economy where transaction can be done without. Cashless nigeria faq on cashless nigeria point of sale pos guidelines. Cbn reintroduces cashless charges on bank deposits.
Cashless nigeria is a policy established in the year 2012 by the central bank of nigeria to curb excesses in the handling of cash in the nigerian federation. Cbn says the cashless policy is strictly applicable to cashbased transactions and not on electronic banking. The findings of the study reveal that cashless policy contributed. For example, ejiofor and rasaki 2012 have noted that the cbn commenced the pilot scheme in lagos state apparently relying on its commercial stamina as nigerias business hub.
Pdf this paper studied the impact of cashless policy in nigeria. There was the recapitalization agenda, then the redenomination of the naira, the noninterest islamic banking and most recently the cashless economy. Effects of cashless economy policy on financial inclusion. In a circular released on friday, the apex bank instructed banks to revert to old. Since the declaration of cashless economy policy by the central bank of nigeria, many scholars have written on this subject matter. In recent years, nigeria has been experiencing a growth. In addition, the policy aimed to reduce costs related to banking and facilitate the progression of monetary policy decisions and. It is in this regard that the central bank of nigeria cbn introduced the cashless. The apex bank pegged withdrawal by individual and corporate accounts at n500,000 and n3million respectively. Cashless policy and economic activities in developing. Effects of cashless economy policy on financial inclusion in nigeria.
The main objective of this study is to evaluate the success of cashless policy in nigeria, focusing on the evidence from the. This study titled central bank of nigeria cashless policy and nigeria economy a study of cbn enugu intends to drive development and modernization our payment system in line with nigerias vision 2020. The central bank of nigeria cbn has introduced a new policy on cashbased transactions which stipulates a cash handling charge on daily cash withdrawals that exceed n500,000 for individuals and n3,000,000 for corporate bodies. Rationale for cashless banking in nigeria the new cashless policy was introduced in april 2011 by the central bank of nigeria. This is because the central bank of nigeria has reintroduced its cashless policy which stipulates a cash handling charge on daily cash withdrawals that. There are several complaints from different quarters that sufficient facilities. Data was collected with a well structural questionnaire and analyzed with descriptive statistics, while hypotheses formulated for the study were tested with correlation coefficient. The analysis shows that the cashless policy has largely been valuable to nigeria, considering the positive effects on gdp, unemployment rate and money. D department of accountancy, university of nigeria nsukka. The impact of cashless policy on the economic growth of nigeria, free undergraduate project topics, research materials, education project topics, economics project topics, computer science project topics, hire a data analyst.
To examine the various challenges associated with the implementation of the cashless policybanking. Nigeria abstract the paper discussed the effects of cashless policy on the nigerian economy, how it was kickstarted in lagos, means of payments both manual and electronic, positive and negative effects of cashless policy, benefits to the economy and stakeholders, suggestions were made. To proffer suggestions on how cashless policy and other monetary policies can be managed for better contribution to the economic growth and development of nigeria. The impact of central bank of nigeria cashless policy in nigeria. In addition, the policy aimed to reduce costs related to banking and. Effect of cashless monetary policy on nigerian banking industry. However, the cost of cash to nigeria financial system is high and increasing.
In 2015, the central bank of nigeria issued a notice to all banks that began collecting charges on withdrawals above the threshold in the remaining 30 states. Cbn reintroduces cashless charges on bank deposits vanguard. The nigerian financial system has always had a huge informal sector resulting in financial dualism with its attendant. Corruption has been identified as a complex, endemic, and multilayered problem that threaten the very existence of nigeria and various efforts have been made by nigerian government to curb the menace. Sep 19, 2019 this is because the central bank of nigeria has reintroduced its cashless policy which stipulates a cash handling charge on daily cash withdrawals that exceed n500, 000 for individuals and n3m for. More number of traders was sampled, compared to students and civil servants, because they are more into business and financial transactions. Jul 07, 2019 apr 22, oyetunji abioye the central bank of nigeria on friday announced the immediate suspension of the implementation of the cashless nigeria.
Theoretical background cashless economy is not the complete absence of cash, it is an economic setting in which goods and services are bought and paid for through electronic media. The central bank of nigeria cbn cashless policy and the. Cbn suspends cashless policy, asks banks to refund. Implementation of the cashless policy central bank of nigeria. The study shows that the cash policy is reduction in the costs of printing the period post the cashless policy has generally been and managing large sums of money. Download this complete banking and finance project material titled. In nigeria as it is in many developing countries, cash is the main mode of payment. The apex bank said it made the decision during the 493rd bankers committee meeting, which held on february 8th in lagos.
It is in line with this, that the national tax policy is set out below. Jul 02, 2019 apr 22, oyetunji abioye the central bank of nigeria on friday announced the immediate suspension of the implementation of the cashless nigeria. The central bank of nigeria cbn, in line with its cashless policy, has reintroduced charges on cash deposits and withdrawals in banks. The new policy on cashbased transactions withdrawals in banks. This was with a view to providing information on the effect of the cashless policy on corruption in nigeria. Further to our circular ref bpsdirigencir04004 we write to inform all deposit money. The cashless policy started with pilot programmes in lagos, january 1st 2012 and a rollout across the country was substituted with phased. This study is to investigate the effects, challenges and prospects of cashless policy on the nigerian economy. Apr 22, oyetunji abioye the central bank of nigeria on friday announced the immediate suspension of the implementation of the cashless nigeria. To examine the impact of the cashless policy on economic growth of nigeria. This is known to have several negative implications for an economy, which is.
The cashless policy is a policy on cashbased transactions, which stipulates a cash handling charge on daily cash withdrawals or cash deposits that exceed n500,000 for individuals and n3,000,000 for corporate bodies. No, you are not going to pay extra n10,000 on every transaction above n500,000. This makes the country to be heavily cash based economy. Cashless economy and financial statement reporting in nigeria emengini, steve emeka ph. The impact of central bank of nigeria cashless policy in nigeria economy. This study therefore assessed the perceptions of stakeholders on the types of corruption that can be reduced. Prospects and problems of cashless policy in nigeria. Cashless economy, cashless policy, lagos state, nigeria. This and other reasons made the central bank of nigeria cbn introduced a new policy referred to as the cashless policy.
Pdf returns of the cashless policy in nigeria mpho. Section 5 and 6 highlights the expected benefits and the challenges facing the cashless policy in nigeria and section 7 discusses the policy implications of cashless banking in nigeria. Electronic banking, deposit money banks, cashless policy, and. Cashless policy aims to curb some of the negative consequences associated with the high usage of physical cash in the. The banks were directed to put a hold on these charges until a directive is given by the cbn.
Apr 21, the cbn in february announced its plan to extend the cashless policy to all the remaining states of the federation by oct. This study seeks to point out the prospects and challenges of such policy, in a developing economy like nigeria. The challenges of cashless policy in nigeria consequently, the implementation of this cashless policy in nigeria featured lots of challenges. Lagos using a survey design and posit that there is a very high degree of awareness of the cashless policy and that the respondents consider it a welcome development. In addition, the policy aimed to reduce costs related to banking and facilitate the progression of monetary policy decisions and economic growth. A cashless policy was recently initiated to curb corruption among other objectives. They recommend that this policy should be implemented nationwide as it has the potential to improve business activities in nigeria. The effect of cashless policy of government on corruption in. The introduction of the cashless policy in march 2012 aimed to drive development and advance payment systems in nigeria. Nigerias cashless policy this case study features four large businesses that have derived clear benefits by early adoption of digital payments, including the nigerian bottling company contracted to cocacola, and the nigerian. Sc department of banking and finance, university of nigeria nsukka abstract. In this connection, more studies focusing on africa in general and nigeria in particular are warranted. The response of large corporates and their value chains to government policies to shift to digital payments.