The dream of Nigeria moving into a full cashless economy appears to be gaining momentum as more citizens have been embracing alternative transaction channels following the worsening paucity of the naira.
At various trading outlets and industries, merchants and buyers are seen using other means of transferring money.
Findings by Investors King revealed that other alternative transaction methods Nigerians have been adopting included USSD, internet banking, mobile app banking, Point of Sales (POS), e-wallet among other electronic channels of transactions.
The federal government, through the Central Bank of Nigeria (CBN), had informed Nigerians of the need to mop out huge cash in circulation, lamenting that many Nigerians have hoarded the naira notes and that it was affecting the economy. For this reason, in 2022, the CBN announced a Naira redesign policy, withdrawal limits, and encouraged Nigerians to adopt electronic forms of transactions.
The apex bank had said that the maximum weekly limit for cash withdrawals across all channels by individuals and corporate organisations shall be N500,000 and N5 million respectively and advised customers to use alternative channels to conduct their banking transactions.
The CBN had said that the use of cash payments would reduce in the country by 2025 and noted that this dream is already contained in its Payments Vision 2025 document.
It explained that by 2025, the country will have a cashless and efficient electronic payment system infrastructure to service all the sectors of the economy.
The bank had asked Nigerians to start adjusting, adding that the use of cash will naturally slow with the ‘mobile first generation’, which will be economically active by 2025. Thus, the bank document explained that one of the focuses of the PSV 2025 is enhancing the cashless policy of the CBN.
The bank assured that the full implementation of the PSV 2025 agenda would contribute to the overall national economic growth and development of the country.
As banks witness huge crowds, especially at the Automated Teller Machines (ATMs) nationwide, people have been going digital for their transactions while others still depend on cash.
This was confirmed by the National President, Association of Mobile Money and Bank Agents in Nigeria, Victor Olojo. He said many residents now seraph vigorously for POS operators and other alternative channels of transactions.
He said some POS agents could not get cash for business and so, have shut down operations while adding that the development further forced people to go digital in their transactions.
Though, this policy has brought untold hardship and frustration on Nigerians, many are surviving it and adjusting to the cashless mode that the nation wants to fully implement.
Nigeria Inter-Bank Settlement System (NIBSS) recently conducted a survey on how Nigerians are adapting to the new order and found out that electronic and cashless transactions are gaining ground.
It said the scarcity of the naira has made POS transactions increase from N573.72 billion recorded in January 2022 to N807.16 billion in January 2023.
The increment, according to NIBSS, is 40.69 percent. It said the total cashless transactions in Nigeria rose by 45.41 percent year in year out to N39.58tn in January 2023.
It said it monitors cashless transactions through the Nigeria Instant Payment System and Point of Sales terminals adding that the total NIP transactions for the period increased by 45.52 percent y-o-y from N26.65tn as of January 2022 to N38.77tn as of January 2023.
According to the inter-bank system, the usage of electronic channels for transactions grew by 45.50 percent y-o-y from 438.48 million times to 638 million times in the period under review, saying that there were 955,234 deployed PoS terminals in the country as of January 2022.