Broadcasting
Are there Really Cashless Economies?
By Yvonne-Faith Elaigwu, Head of Operations and Governance, OnePipe
‘Cashless’ has probably become one of the most popular words in Nigeria in the last few months. While it can be defined in different ways, it has one universal meaning and is characterised by the exchange of funds for goods and services by methods other than the use of cash.
This little or no dependence on cash is not forced by an inability to queue for hours at an ATM or an unwillingness to pay an exorbitant fee to a PoS or mobile money agent. No, this little dependence on cash is because of the ability to meet financial obligations without necessarily needing to handle cash.
You are probably thinking about the western world and the level of development that makes this their reality but some very solid examples of cashless economies also exist in Africa.
One of the easiest ways to identify a Nigerian in Kenya for example (excluding the Naija-ness) is by how they transact. As a Nigerian visitor, you are very likely to pay in cash when you buy food, shop at a neighbourhood market, buy things from the roadside or visit a tourist centre. This alone – paying in cash everywhere – is more likely to scream “foreigner” than if you had worn a green-white-green Ankara at that time.
When the M-Pesa platform marked its 15 year anniversary last year, it had grown to more than 51 million customers, 465,000 businesses, 600,000 agents, and 42,000 developers across Kenya, Tanzania, Mozambique, the Democratic Republic of Congo, Lesotho, Ghana, and Egypt, as reported by Business Insider.
Ghana, our neighbours, digitised their economy with Mobile Money. The Bank of Ghana in its payment systems annual report for 2021, reported that its volume of Mobile Money transactions increased to 4.25 billion in 2021, representing a 47.1 percent growth, compared to 2020. Similarly, the total value of transactions increased to GH¢ 978.32 billion in 2021, from GH¢ 571.80 billion in 2020.
In dollar terms, the value of transactions in 2021 was $75 billion (based on current exchange rates). For perspective, Ghana’s GDP was $77.59 billion that same year. This essentially shows us mobile money transactions could cover the entire economic activities in Ghana (when currency devaluation over the past year is factored in).
The Carnegie endowment for international peace also referencing a BOG report, said in recent years, Ghana has been identified as one of the biggest mobile money markets and the fastest-growing one in Africa with 40.9 million accounts as at February 2021. Again, for context; the population of Ghana is 32.8 million. A Business Day report in 2019, noted that in Ghana, the utilisation of Mobile Money has become so ubiquitous, that it no longer has a wow effect, and is just a part of their everyday life. The average Ghanaian can go about his or her day and be productive without ever needing to transact with cash, just like their peers in Kenya and other countries where cash is increasingly less important.
Somalia’s journey to a cashless economy is perhaps the most inspiring. It is recorded that between 1990 and 2013, Somalia received no foreign direct investment, and the monetary system broke down with the collapse of the Somali Central Bank. The Somali government installed its first ATM in 2014, but the progress of its wider digital economy has been astonishing. The Somali Central Bank introduced a central payments system in August 2021 which connects the nation’s 13 lenders, and formalises digital payments, making payments easier for people across the country.
According to a report by the World Bank published in 2018, almost three-quarters of the Somali population aged 16 and older use Mobile Money. Somalia’s Gross Domestic Product, grew by an estimated 2.9 percent in 2019 and by 3.2 percent and 3.5 percent in 2020 and 2021 respectively. Eight years after the installation of their first ATM, Somalia is now recognized globally as a cashless economy.
Today, in its urban centres, Mobile Money penetration is over 80 percent. Even in rural areas, it has become the currency of choice, with a penetration rate of 55 percent.
Need we add examples of the western world? Maybe just a few.
In 2022, Merchant Machine ranked Norway on the list of 10 countries closest to a completely cashless society, with cash accounting for only 2 percent of all payments in Norway, 100 percent of its population owning a bank account, and 71 percent also owning a credit card.
It was followed by Finland with the same small percentage of cash-based payments ( 2 percent) and none of its citizens going without a bank account, then New Zealand also having two percent cash-based payments but a very slightly higher unbanked population of one percent.
The UK ranks lower at number eight due to a slightly smaller percentage of credit card users (65 percent) and higher percentage of unbanked population (3 percent). However, it sees less cash-based payments overall, with just 1 percent of all payments being made with notes and coins.
Now imagine a scenario where you navigate the city of Lagos without worrying about “change”, or whether the cash in your hand is not counterfeit or too worn out. Imagine not worrying about making any payments, not because you are a Dangote or because Otedola is your daddy, but because you have various payment options in your pocket or at your disposal; cards, phone, apps, USSD codes etc. More importantly, imagine that your transactions are happening within the banking ecosystem, your bank therefore has visibility into your spending patterns and is able to adequately profile you to access credit. Despite the promising future a cashless economy offers, the experiment in India has offered the rest of the world some lessons on how not to go about it. The Economic Times of India for instance, noted that after invalidating 86 percent of the currency in circulation (the 500 and 100 notes), the government started scrambling to promote digital payments, yet, only about half of Indian adults had bank accounts, and only about a quarter had internet access. Mobile payments were rare and even if everyone had wanted to go digital, they couldn’t have.
The lesson? Before going cashless, alternatives should not only be in place, but reliable too. India’s move towards going cashless has not been a complete failure but it came at huge human and economic loss.
An article on The Balance Money describes a cashless society as one where all transactions are electronic, using debit or credit cards or payment services like PayPal, Zelle, Venmo, and Apple Pay. In Nigeria, we have companies like OnePipe, offering technologies that digitise and simplify payment processing to downplay the dependence on cash.
Although not a lot of societies are truly cashless, many economists believe that consumer preferences, competitive pressures on businesses, profit seeking by banks, and government policies designed to facilitate cashless transactions will soon lead to more cashless societies which eventually lead to economic growth.
Multichoice Nigeria, leading pay TV operator, has again increased the subscriptions for its DStv and GOtv packages by at least 25 per cent .
ohn Ugbe,
Multichoice announced the increase in tarrifs in a message sent to subscribers on Wednesday and said that the new regime will be effective May 1.
The company stated this in the statement signed by John Ugbe, chief executive officer was titled, ‘Price Adjustment on DStv and GOtv Packages.’
The pay-TV firm cited the rise in the cost of business operations as the rationale behind the price increase.
The company said, “We understand the impact this change may have on you – our valued customer, but the rise in the cost of business operations, has led us to make this difficult decision.
“It remains our mission to provide the best entertainment and viewing experience to you and are committed to continue to deliver high-quality content and unparalleled service. So, from Wednesday, 1 May 2024, the price adjustment will take effect.”
With the review, customers on the DStv Premium package will see their monthly subscription fee increase to N37,000 starting from May 1, marking a 25.4% rise from the current N29,500.
Also, price of the Compact+ bouquet has been raised to N25,000 from N19,800 per month, reflecting a 26.2% increment.
DStv has also announced that subscribers on its Compact bouquet will now pay N15,700, up from the current N12,500, representing a 25.6% increase.
Meanwhile, those on the Confam package will face a 25.6% hike as their monthly subscription rises to N9,300 from N7,400.
Under the new pricing structure, viewers on the DStv Yanga bouquet will be charged N5,100 for their monthly subscription, marking a 21.43% increase over the current N4,200 fee.
Multichoice has announced price increases across its GOtv packages. Customers on the Supa Plus package will now pay N15,700, marking a 25.6% rise from the current price of N12,500. Similarly, the Supa bouquet will see its price increase to N9,600 from the current N7,600.
For the GOtv Max subscription, the new price is N7,200, up from N5,700, while the Jolli package will now cost N4,850, compared to the current price of N3,950. Multichoice has also adjusted the price of its lowest GOtv package, Jinja, which will now be N3,300 monthly instead of the current N2,700.
Broadcasting
Alleged $500m wasteful investments: I stand by my words, Heineken Lokpobiri dares Wabote
Sen. Heineken Lokpobiri, Hon Minister Of State For Petroleum Resources have reiterated that he stands by his statement at The Petroleum Club’s quarterly event in Lagos, that NCDMB wasted over $500 million of the industry’s fund in equity investments in private establishments and in loans that are now non-performing.
The minster while reacting to recent media statement by SIMBI Wabote, former executive secretary to the Nigerian Content Monitoring and Development Board, NCDMB, dismissed as blatant lies from the pit of hell, claims that his office requested for increase on NCDMB budget by N30 billion for the office of the Minister.
In a statement signed by the Nneamaka Okafor ,SA Media and Communication, Minister Of State For Petroleum Resources(Oil),the minister noted that ‘’Our position is that he who alleges must prove same. So, if Mr. Wabote has proof of such conversation, he is challenged to provide same.
‘’Secondly the Minister has no aide called Blackson. All his aides were duly selected in line with extant laws and have documents to that effect.
According to the statement ‘’The Minister in his capacity as chairman of the Governing Council stands by his statement at The Petroleum Club’s quarterly event in Lagos, and as journalists I welcome you to visit the places mentioned to verify the allegations for yourself.
‘’Thirdly, the said Atlantic Refinery was supposed to be built in Mr Wabote’s home town, he should show Nigerians where that refinery is.
‘’Fourthly, the Brass Fertilizer and Petrochemical company was also paid for, you are welcomed to also visit the site to verify the facts for yourself.
The statement noted that Investigations are ongoing and the truth will surely come to light and monies belonging to the generality of Nigerians will be recovered for Nigerians.
‘’Let me add that these revelations are not new, they were first made during an investigative hearing of the House of representative committee on local content. Again the records are there and you are welcome to verify these facts.
‘’The Minister has never been part of any budgeting process of any parastatal under the Ministry, you are welcomed to visit these agencies to verify for yourself.
‘’Finally, the Minister’s office is run with a budget superintended by the permanent secretary and so one will wonder, how the Minister will ask another entity to make provisions for the budget of his Office. The Minister has an impeccable record from his time as Minister of Agric and will continue to stand for the truth.
The Minister and Indeed the Chairman of the Governing Council of the NCDMB will not abdicate his responsibility to please anyone. He has a responsibility to ensure that, that which belongs to Nigerians is judiciously used for Nigerians
‘’I have had course to read Mr Wabote’s release and every one can see that he is still nursing the wounds of being replaced even after spending seven years at the Board. At best, this is a clear case of when you fight corruption, corruption will fight back.
It would be recalled that the Minister at at an event in vowed to recoup alleged investments worth over $500m made by the Nigerian Content Monitoring and Development Board (NCDMB).
However, The erstwhile Executive Secretary of the NCDMB, Engr.Simbi Wabote had earlier debunked the Minister’s statement describing it as reckless.
Wabote challenged the Minister to visit the sites of the projects the agency invested in while accusing the Minister of playing politics.
“The HMSPR-Oil is implored to visit the construction sites to avail himself of facts on ground. He should also check the MPR archives of the strategic plan to diversify oil and gas development clusters in the Niger Delta using Bonny Island, Brass Island, Onne, Ogidigben, Ibom, etc. Perhaps, this will cure his aversion to any developmental initiative in Brass Island and the Niger Delta in general.” Wabote said.
Broadcasting
Techy Accountants in partnership with ACCA Host AccounTech Summit to Empower Finance Professionals
The AccounTech Summit, hosted by The Techy Accountant in partnership with the Association of Chartered Certified Accountants (ACCA), is a groundbreaking event designed to navigate the evolving landscape of the finance industry in the digital era.
Recognizing the critical need for finance professionals to adapt to technological advancements and emerging trends, this summit is a driving force for innovation, transformation, and progress.
The event is set to take place as follows:
Date: August 15th, 2024,
Location: Radisson Blu Anchorage Hotel in Lagos, Victoria Island, Nigeria.
Time: 9:00 A.M
The summit aims to celebrate achievements in the finance sector, support entrepreneurship ventures, and enlighten participants on industry challenges and opportunities. With a focus on bridging the employability gap and promoting high-quality skill development in finance, the summit aims to address the evolving landscape of the industry in the digital age.
Over the past six years, The Techy Accountant has graduated over 1000 finance professionals and trained more than 5000 individuals worldwide.
Event Highlights
The one-day event will bring together over 200 attendees, including finance professionals, entrepreneurs, policymakers, academics, and Techies.
Attendees can expect a day of immersive learning and collaboration, culminating in an award and grant ceremony. Event Highlights include keynote sessions, interactive workshops, panel discussions, and networking opportunities, all centred around the theme “Emerging Tech in Accounting & Finance – A Game Changer.”
Commenting on the summit, Mrs. Toyin Olufon, Founder of The Techy Accountant stated, “We believe in equipping finance professionals with the skills needed to thrive in a rapidly changing industry”.
Commenting on the collaboration, Mopelola Jatto, CFA, Regional Head, ACCA Nigeria remarked, “Partnering with The Techy Accountant underscores our commitment to fostering innovation and driving excellence in the finance profession. Together, we aim to equip professionals with the skills and knowledge required to thrive in the digital age.”
TO REGISTER, VISIT: https://thetechyaccountant.org/event/the-techy-accountants-account-tech-summit-2024
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