Cbn new cashless policy 2019
The Central Bank of Nigeria (CBN) introduced a new cashless policy in 2019, which aimed to reduce the use of cash transactions and promote electronic payments in the country. Here are some key features of the policy:
Key Features:
- Cash Withdrawal Limits: The policy introduced daily cash withdrawal limits for individuals and corporate organizations. For individuals, the limit was set at N500,000 (approximately $1,300) per day, while for corporate organizations, it was set at N3,000,000 (approximately $7,700) per day.
- Cashless Policy Zones: The policy designated certain areas as cashless policy zones, where cash transactions would be heavily restricted. These zones included major cities like Lagos, Abuja, and Port Harcourt.
- Electronic Payment Channels: The policy encouraged the use of electronic payment channels such as mobile banking, online banking, and card payments.
- Penalties for Non-Compliance: The policy introduced penalties for individuals and organizations that failed to comply with the cashless policy. These penalties included fines and imprisonment.
- Exemptions: The policy exempted certain transactions from the cashless policy, including transactions related to agriculture, small-scale businesses, and rural areas.
Objectives:
The objectives of the cashless policy were to:
- Reduce Cash Transactions: The policy aimed to reduce the use of cash transactions and promote electronic payments.
- Increase Financial Inclusion: The policy aimed to increase financial inclusion by making it easier for people to access financial services.
- Reduce Corruption: The policy aimed to reduce corruption by reducing the use of cash transactions, which are often associated with corruption.
- Boost Economic Growth: The policy aimed to boost economic growth by increasing the use of electronic payments, which are faster and more efficient than cash transactions.
Impact:
The cashless policy has had a significant impact on the Nigerian economy. Some of the key impacts include:
- Increased Electronic Payments: The policy has led to an increase in electronic payments, which has reduced the use of cash transactions.
- Improved Financial Inclusion: The policy has improved financial inclusion by making it easier for people to access financial services.
- Reduced Corruption: The policy has reduced corruption by reducing the use of cash transactions, which are often associated with corruption.
- Boosted Economic Growth: The policy has boosted economic growth by increasing the use of electronic payments, which are faster and more efficient than cash transactions.
Challenges:
Despite the positive impacts of the cashless policy, there have been some challenges. Some of the key challenges include:
- Resistance to Change: Some individuals and organizations have resisted the change to electronic payments, preferring to stick with cash transactions.
- Infrastructure Challenges: The policy has highlighted the need for improved infrastructure, including internet connectivity and electronic payment systems.
- Security Concerns: The policy has raised security concerns, including the risk of cyber attacks and data breaches.
- Exemptions: The policy has raised concerns about the exemptions, which have created confusion and uncertainty.
Overall, the cashless policy has been a significant step towards reducing the use of cash transactions and promoting electronic payments in Nigeria. While there have been some challenges, the policy has also had a positive impact on the economy and has improved financial inclusion.