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
Securities and Exchange Commission (SEC) has warned the public against investing in unregistered investment schemes, including Silverkuun Investment Cooperative Society/Silverkuun Limited.
In a circular issued in Abuja, yesterday, the commission said its attention had been drawn to the activities of these entities, which falsely present themselves as investment advisers and fund managers in the Nigerian capital market.
“The attention of the Securities and Exchange Commission has been drawn to the activities of Silverkuun Investment Cooperative Society/Silverkuun Limited which holds itself out as an Investment Adviser/Fund Manager.
“The Commission hereby informs the public that Silverkuun Investment Cooperative Society/Silverkuun Limited is not registered to operate in any capacity in the Nigerian Capital Market.”
SEC advised the public to refrain from engaging with Silverkuun Investment Cooperative Society/Silverkuun Limited or its representatives in respect of any business in the Nigerian capital market.
“The Commission uses this medium to reiterate that transacting in the Nigerian Capital Market with unregistered and unregulated entities exposes investors to financial risk including fraud and potential loss of investment.
“The investing public is therefore reminded to verify the status of companies and entities offering investment opportunities on the Commission’s portal before transacting with them,” the SEC added.
Dr. Emomotimi Agama, director-general of the SEC, recently warned that the Commission would not hesitate to shut down the operations of such unregistered entities while also ensuring that the promoters are made to face the full weight of the law.
Agama said, “we will shut down their operations and the promoters will be made to face the full weight of the law.
“In a major reform, ISA 2025 officially brings digital assets under the SEC’s regulatory purview, defining them as securities and mandating registration for all virtual asset service providers (VASPs) and digital asset exchanges. This development aims to close the regulatory vacuum that has allowed many Ponzi-style platforms to thrive under the guise of cryptocurrency and digital finance.”
Agama also emphasized the Commission’s education-focused strategy to combat fraud through podcasts, digital campaigns, and the introduction of capital market literacy in schools and universities, the SEC aims to equip Nigerians with the knowledge to detect and avoid dubious investments.
Africa’s cross-border payments market is on track to hit $1 trillion by 2035, according to a new report by venture capital firm Oui Capital. Titled “Africa’s Cross-Border Payment Landscape—a deep dive into the systems, players, and shifts shaping Africa’s cross-border payment flows,” the report states that the market is currently valued at $329 billion and growing at a compound annual growth rate of 12%.
It identifies Africa’s booming digital adoption, increasing intra-African trade, and a surge in mobile money usage as the key growth drivers.
Despite the impressive growth, the report highlights systemic inefficiencies.
“Legacy rails, double currency conversions, and fragmented regulations still siphon billions in hidden costs,” Oui Capital states, noting that the continent continues to have the highest global remittance costs, averaging 7–8%.
However, digital innovation is helping reshape the landscape. Mobile money is now a key channel, with 30% of Sub-Saharan remittances flowing through mobile wallets.
In 2022, Africa accounted for 66% of global mobile money transaction value, demonstrating the rapid formalisation of what was once a predominantly informal cash ecosystem.
Oui Capital sees significant investment potential in addressing these inefficiencies. “Infrastructure plays—interoperable API layers, decentralised FX liquidity pools, and PAPSS integrations—represent $10 billion-plus opportunities,” the report says.
The Pan-African Payment and Settlement System is one such initiative pushing for local currency settlements and reduced reliance on USD/EUR clearing, which presently adds around $5 billion in annual costs.
According to the report, cryptocurrencies and Stablecoins are emerging as promising alternatives, cutting remittance costs by up to 60% in markets with clear regulations.
“Fintech APIs are already pushing fees as low as 1.5–3%,” the report notes.
Still, the venture capital firm warns that challenges persist as only 55% of African jurisdictions allow full electronic KYC, limiting the scalability of fintech solutions.
The report urges founders to go beyond peer-to-peer transfers by embedding services like lending and insurance.
“Africa’s payments race is now a scale game. Those that solve for liquidity, compliance and cost will define the continent’s digital trade backbone over the next decade,” it concludes.
Chartered Institute of Bankers of Nigeria has expanded its Agency Banking Certification Programme through a tripartite collaboration between the Institute, FIC, and SANEF Limited.
This partnership according Prof. Pius Deji Olanrewaju, President/Chairman of Council the Chartered Institute of Bankers of Nigeria, CIBN, is timely and strategic, “as we aim to broaden the reach of the certification across Nigeria’s agent banking sector. With SANEF’s deep integration in the financial inclusion ecosystem and established relationships with leading super agents, we are confident that this collaboration will strengthen the quality and visibility of the programme.
“The goal is clear, to enhance professionalism among agent bankers, support the national financial inclusion strategy, and contribute to building trust and integrity within this growing segment of the financial services sector. This collaboration presents an excellent opportunity for further implementation of the competency framework for the banking industry in Nigeria”.
He noted that the collaboration among others is part of his LEGACY agenda which highlights the multifaceted role of financial institutions in shaping Nigeria’s economic future.
The letter C in the LEGACY agenda refers to Competence in the banking and Finance industry, which is a very crucial factor in the banking and finance sector. Competent individuals in this industry are equipped with the necessary knowledge and skills to effectively manage financial resources. Individuals with expertise in this field can contribute to the growth and stability of the economy.
Mrs. Uche Uzoebo, Managing Director/Chief Executive Officer, Shared Agency Network Expansion Facilities, SANEF, described the memorandum of Understanding, MoU, as a visionary partnership that seeks to expand Financial Inclusion through Agent banking training, Financial Literacy and knowledge impartation, an objective that forms a key pivot of what SANEF represents.
“Over the years, SANEF, in strong collaboration with our key stakeholders, Banks and Licenced Super-Agents/Mobile Money Operators and other Financial Service Providers, have continued to deepen the frontiers of Financial Inclusion and agent bank. Financial Literacy and training have remained a key part of this objective.
“This MOU ceremony is a fulfillment of a shared vision through the expansion of Agent Banking, Financial Literacy, capacity building, thought leadership, training and competency.
She further explained that the agreement provides a training structure with well-curated and knowledge filled training modules and materials that will deepen the knowledge and capacity in agent banking.
“It will go ahead to deepen and expand the knowledge and capacity of all participants that will take part in this training and we believe that with the quality and cooperation of all parties present, this very important objective of impartation of knowledge and thought leadership, grooming and training minds to be empowered and learned and contributing our quota to nation building and be a better place,” she added.
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