E-Financial
Dissecting CBN’s Cashless Programme In A Cash-Oriented Society
In 2012, when the Central Bank of Nigeria [CBN] introduced the cashless policy, the crux of the objectives was to encourage more electronic-based transactions for payments of goods, services, and transfers, etc.
Between 2012 and now, come one say if the policy has achieved these objectives? Has the CBN encouraged more electronic-based transactions for payments of goods, services and transfer? Is there an answer in the CBN’s e-collection platform, a solution that allows electronic collection of government fees, taxes and custom duties, which equally let government agencies exploit the full capabilities of the technology to transform its services to the public?
The digitization of collection process may have served the CBN as a means to achieve its cardinal objective, which is to engender a cashless environment.
According to Director, Banking and Payments System of the CBN, Dipo Fatokun in a report, the cashless policy drive development and modernization of CBN’s payment system in line with Nigeria’s vision 2020 goal of being amongst the top 20 economies by the year 2020.
The cashless policy, he concurred, is designed to reduce, “not eliminate the amount of physical cash” circulating in the economy, while encouraging more electronic-based transactions.
The CBN director agreed that the cashless policy has reduced the cost of banking services including cost of credit and drives financial inclusion by providing efficient transaction options and greater reach, and improves the effectiveness of monetary policy in managing inflation and driving economic growth.
However, has this policy driven financial inclusion, reduce high security and safety risks, facilitate the growth of e-commerce, foster transparency and curb corruption/leakages?
To answer these questions, let us dissect how the policy has affected banking, corporations, government and the banking public.
For the banks, again let us turn to Fatokun, the policy has enhanced profit and income line, reduced risk of cash related attacks, reconciliation and tracking of transactions and payments.
It has opened efficient and effective means of processing transactions on e-channels thereby reducing cost of operations such as cash handling and other associated cost of dealing with cash transactions.
For corporations, research shows that the policy has given the corporations faster access to needed capital, reduced revenue leakage and reduced cash handling cost.
With the myriads of e-channels installed, a corporation can easily make bulk payment across multiple banks in real time.
Added to that, accounts reconciliation, which is described as a “monster” by MD/CEO, PFS the company behind the cheque truncation regime, Yele Okeremi, is now being nip in the bud.
For bank consumers, the CBN cashless policy has increased convenience, cheaper access to (out-of-branch) banking services and access to credit.
This is debatable: my company approached a bank for an overdraft. The bank asked for collateral that is above the overdraft.
In short, the bank did not grant the over draft because our company did not produce the collateral. Case closed.
The policy, according to the CBN, has reduced over-all cost of handling cash and risk of cash related crimes.
This is accurate: Most bank customers have now adjusted to making payments using e-channels such as card, PoS, online and mobile banking as well as ATM for cash withdrawal.
Besides, bulk payment across multiple bank accounts is now possible. With a mobile app installed on my smart phone, I regularly make payments to friends and siblings without visiting the banking hall. Making payment with the PoS is catching on but it can be better.
Paying for good on e-commerce sites in Nigeria is now trending. Booking hotel room, buying air ticket is now a fad.
For government, the policy has brought firmer grip on monetary policy and its attendant effects on inflation and economic stability, greater financial inclusion, increased economic development and transparent tax collection.
It has also increased internally generated revenue [IGR]. The success stories of increased IGR by some state governments such as Lagos would include the introduction of the Lagos State Government Electronic Banking system of Revenue Cycle Management (LASG EBS-RCM) with the Direct Bank Lodgment System (DBLS) of the revenue collection process in 2002.
IGR has grown annually at an average of 6%.
After the pilot of the cashless policy in 2012, IGR grew by 10%.
In Ogun State, which introduced a cashless pilot scheme in 11 state-owned tertiary institutions in response to revenue leakages, witnessed increase in revenues in 2012 to the tune of N2.5billion, which is 195% increase from reported revenues in first quarter of 2011 without an increase in fees.
However, to plug loopholes in the Federal Government revenue collection system and enthrone a new regime of transparent and accountable IGR management, the Office of Accountant General of the Federation [OAGF] has created Government Integrated Financial Management Information System [GIFMIS] in association with Remita, the asset of SystemSpecs, which is the CBN payment gateway.
This is done in collaboration with Deposit Money Banks (DMBs) and other electronic collection channels like cards, PoS, ATMs, mobile wallets.
This, too, is in line with the CBN e-payment policy.
With GIFMIS, all government payments are now routed to the CBN Payment Gateway for onward payment into beneficiary’s accounts.
This indicates that all 700 ministries, directorates and agencies [MDAs] are involved directly in this set up. Meanwhile, the Payment Gateway, hosted by Remita, is connected with the CBN T24 banking application and GIFMIS solution for an end-to-end automation of payment and collection processes of federal government.
The CBN policy has enthroned a new regime of transparency in the allocation of funds, as the budgets of all 700 MDAs is handed over to individual management, separate from that of the supervising ministry.
As it stands MDAs cannot spend beyond the approved budget. If you understand what operates in the MDAs environment, cash is king.
The CBN has successfully eliminated cash and enthroned e-collection and e-payment. Through this process, the government has already saved over N500 billion. One wonders who were the beneficiaries of this N500 billion?
Anyway, the journey is still far, the road tortuous. From the above, could one clearly say that the CBN has created a cashless environment in a cash-minded Nigeria?
Has the CBN encouraged more electronic-based transactions for payments of goods, services and funds transfer in Nigeria?
Rarzack Olaegbe works with eMaginations, with baise for electronic payments, based in Lagos
The sixteenth season of DiamondXtra, a savings and reward account where customers of Access Bank are rewarded with several prizes, have been unveiled in Lagos.
L – R : Doris Okpara, Product Manager, DiamondXtra; Ngozi Igboanugo, Regional sales Manager Festac 1&2 & mainland Access Bank; Bolarinwa Animashaun, Regional Sales Director Lagos 2 Access Bank ; Emeka Ezikeugo, Diamondxtra N200,000 Onsite winner; and Adaeze Ume, Head Consumer liabilities, Access Bank during the launch of Diamondxtra Season 16 held at Alaba International Market Lagos yesterday.
The Season 16th of the special interest yielding hybrid account which allows deposit of both cash and third-party cheques has been upgraded as customers will win prizes to the value of N200 million and three SUVs, amongs other mouthwatering prizes.
Speaking at the unveiling in Alaba International Market, Lagos, Mr Bolarinwa Animashaun, regional sales director, Lagos, said the new season will bring more goodies to the customers as the bank has taken their interest at heart.
“In the last fifteen years, we have been able to ensure customer loyalty, reward committed customers over time and show that we are a bank that is ready to empower people and partner with people.
“If I take it into specific figures, we have rewarded 26,696 customers and we’ve given a total sum of N6.5 billion over the period.
This Season16is interesting, because, we have seen a lot of opportunities to expand into digital opportunities and this time around, we will be rewarding 15,786 customers, and 10,000 of them will be digitally rewarded.
“This is almost half of what we have done over the last 15 years. So that is what is making it special. We have takenit into the possibilities of how technology can expand our business and reward customers”.
The draws for the new season are going to be the same like the previous ones as it will be held in different regions.
“So, we start from the monthly draws, quarterly draws and the annual draws. What makes it extremely interesting this year is that we will be rewarding with up to N200 million in prizes and we have added some very interesting gifts. We will be given out three SUVs as part of the N200 million price for this year”, Animashaun added.
At the unveiling, Access Bank conducted onsite draws where 48 customers who have DiamondXtra accounts and were present at the unveiling won cash prizes ranging from N20,000 to N200,000.
Breakdown shows 40 customers won N20,000 each, five customers won N50,000, two customers won N100,000, while one customer went home with N200,000.
Among winners of the N20,000 prize was Mr Victor Edobor, who said he opened the DiamondXtra accounts 24-hours before the draws.
One of the two winners of the N100,000 prize, Mrs. Maureen Nneka Oforka, said she was surprised to have won at the well-attended event as that was her first time winning any prize.
She said, “I have never won any prize in my life. This is my first. I came here reluctantly and thank God, I am here and I am a winner of N100,000 which has already been paid into my account.
The grand prize winner of N200,000, Mr. Emeka Ezikeugo, a trader in Alaba, said. “I will forever be grateful to Access Bank for the prize as I was not expecting it. I thank the bank for showing leadership among its peers”.
To be part of the winning train and qualify for the DiamondXtra season 16 which is open to both new and existing customers, new customers are required to open a DiamondXtra savings account with just N5,000 by dialling *901*5# or walking into one of our branches to open the account.
However, the more multiples of N5,000 both new and old customers save, the higher their chances of winning at the monthly, quarterly and annual draws.
DiamondXtra is an interest yielding hybrid account which allows deposit of both cash and third party cheques. Hybrid means a combination of both savings and current account features. The DiamondXtra reward scheme has given away over N6.5 billion in cash and household items to over 15,000 loyal customers over the last 15years. Please click HERE to learn more.
Recognising the underrepresentation of women in the technology sector, Lafarge Africa Plc, has launched the Girls in Tech Program, a pioneering initiative aimed at empowering young women in technology.
Meticulously crafted to bridge the gender gap in tech and empower 10 young females between the ages of 18-25 years from Lafarge Africa Host communities in Cross River State, the program is poised to make a significant impact in the region.
The Girls in Tech Program seeks to harness the unique talents of these young women and introduce them to the dynamic world of technology. By providing them with essential skills and opportunities, the initiative aspires to equip them to become self-reliant as well as problem solvers in society.
In collaboration with Aptech and Arena Multimedia,globally recognized leaders in technology incubation and opportunity, as well as The Bridge Leadership Foundation, the boot camp promises to be a transformative experience for the participating girls, who are eager to make their mark in the tech industry.
Speaking during the onboarding to flag-off in Calabar recently, the Plant Manager, Lafarge Africa Plc, Sotirios Valsamakis, who was represented by the Human Resources Business Partner, Lafarge Africa Plc; Barong Ita, revealed that the program was in line with the company’s commitment to diversity and inclusion.
She also added that the initiative is designed to ignite a spark of inspiration, hope, and possibilities in the heart of the selected girls across the host communities.
“As an organization, people are an integral part of our sustainability drive, and we are invested in building lasting progress by empowering members of our host communities. We also recognize the need for greater and greener diversity and inclusivity within the tech sector.”
Today’s event is not just about launching a program. It is about igniting a spark of inspiration, hope, and possibilities in the hearts of these young women. It is about challenging stereotypes.”
Also speaking at the event, the Cross Rivers State Commissioner for Science, Innovation & Technology, Justin Beshel represented by Edwin Adie, Technical Senior Advisor, Cross Rivers State Ministry of Science & Technology commended Lafarge Africa for the initiative adding that it is in line with the State government’s plan towards science, technology and innovation development.
As the country faces economic challenges, the need for adaptive strategies in the fintech industry becomes paramount. In line with this, leading Fintech startup, Hydrogen Payment Services Limited (‘Hydrogen’), has teamed up with Co-creation Hub (‘CcHub’) to host an insightful event themed, ‘Adapting Fintech Business Models to Economic Climes’.
The event, set to take place on Thursday, April 18, 2024, from 12:00 WAT at the CcHub office in Sabo, Lagos, will delve deep into the intricacies of Nigeria’s economic challenges and how these influence the fintech ecosystem.
Participants will gain actionable insights on how to adapt fintech business models to volatile economic conditions by prioritising flexibility, agility, and customer-centricity.
This collaboration underscores the shared commitment of both entities to empower aspiring founders venturing into the Fintech space amidst economic uncertainties.
By leveraging their respective expertise and resources, Hydrogen and CcHub aim to equip emerging entrepreneurs with the knowledge, tools, and support needed to thrive in today’s dynamic economic conditions.
Emeka Awagu, Chief Technology Officer at Hydrogen, commented on the strategic partnership with CcHUB: “Our alliance with CcHUB amplifies our shared commitment to pioneering transformative solutions in Nigeria’s fintech sector.
“By leveraging Hydrogen’s technological expertise alongside CcHUB’s innovative approach, we are primed to set a new standard for fintech excellence and drive impactful change across the industry.”
The event will feature a distinguished panel of industry experts and thought leaders, including, Ina Alogwu, Group Director, Digital Transformation, ARM HoldCo; Emeka Awagu, Chief Technology Officer, Hydrogen, and Miracle Ezechi, Digital Marketing Manager, Hydrogen.
The panel discussion will be moderated to encourage an engaging and insightful conversation on the strategies and innovations required to thrive in Nigeria’s Fintech landscape amidst economic challenges.
NELFUND Says UTME, NIN, BVN Mandatory for Student Loans
Sun International Finalizes $14.4M Exit from Nigeria, Sells Interests to RFC
Sam Darwish, US-Nigerian Businessman Suffers $6m Loss as IHS Shares Plunge
NITDA, NIMC Partner for Seamless Data Exchange Capabilities
FG Plans EO to Criminalise Fiber Cable Damage Costing Telcos Billions
See Full List of Fake Loan Apps Blacklisted By CBN
FIRS Files Tax Evasion Charges against Binance
IFC Invests in New 4DX Ventures Fund to Support Tech Startups in Africa
AXA Mansard Empowers Female SMEs with Financial, Digital Skills
Moniepoint Study Reveals How Strong Cultural Bonds, High Levels of Trust Drives Nigerian Family Businesses
News3 days agoQNET Raises Alarm over Fraudulent Use of Foundation’s Name in Nigeria
News3 days agoSoftTalk Messenger Introduces Chat and Make Calls without Sharing your Phone Number
Telecom3 days agoStarlink Users in SA to be Cut Off April 30
Telecom3 days agoNCC Advises Subscribers to Opt for Strong Passwords to Beat Hackers
Broadcasting3 days agoCanal+ Offer for MultiChoice Gains Shareholders’ Support
Telecom2 days agoImperative of Upholding Nigeria’s Telecoms Lifeline
Telecom3 days ago9mobile Clinches 2 Trophies at the Prestigious SABRE Awards 2024
E-Financial3 days agoFidelity Bank Reports N124.3Bn Pre-Tax Profit for 2023