IMPLEMENTATION OF THE CBN CASHLESS POLICY: NECA CALLS FOR CAUTION.

Following the recent directives by the Central Bank of Nigeria (CBN), for the immediate implementation of a Cashless Policy,  Nigeria Employers Consultative Association (NECA), advised  that the current business environment and available infrastructures are not ready for such deployment.

Making this disclosure in a statement, yesterday, Director-General of NECA, Timothy Olawale,  said "although the initiative is laudable in moving the economy in par with other emerging economies, however, the current business environment and available infrastructures are not ready for such deployment. Also, several sub-sectors of the economy will be negatively impacted by the policy, as they are still predominantly cash dominated further stating the example of the Fast Moving Consumer Goods and Retailers, Downstream Oil & Gas Sector, Transportation Sector among others”.

In his analysis of the policy, he explained that “while Corporate account holders are still battling with Stamp Duty charge of N50 on every eligible transaction above N1,000, Commission on turnover (COT ) of 0.1 percent, the about to come on stream 7.2 percent VAT, etc, with the additional 5 percent as processing fee for withdrawals and 3 percent as processing fee for lodgments of any amount above N3million, it is needless to say that the policy is an overkill , exploitative and would negatively impact the citizens”. He noted the country’s Doing Business Report (2019) rating of 146th out of 190 economies, this and other uncoordinated and unplanned policies would further bring hardship on the people and lead to further contraction of the economy.

He called for an exemption for the sub-sectors aforementioned, if CBN would still go ahead with its policy and called for its review. He canvassed that CBN should ensure that all Deposit Money Banks improve their facilities as against inefficiency in our payment platforms and reduce incidences of frauds.
Concluding his remarks, Mr.  Olawale reiterated the need for wide consultation and stakeholders’ engagement on an ongoing basis before policy statements are made or concluded.