By Sanusi Muhammad
Godwin Emiefele is by appointment, the Governor of the Central Bank of Nigeria. He was inherited and retained by President Muhammadu Buhari for reasons best known to Mr. President.
The CBN Governor is by virtue of his appointment, expected to be part of the engine of the nation’s economic growth. Unfortunately, despite the confidence reposed in him by Mr. President, the economy is on its knees courtesy of poor economic policies and implementation spiced with suspected sharp corrupt practices.
A cashless policy has been introduced supposedly to protect and project the economy while the convenience of carrying less, bank notes in doing business cannot be overemphasized. But methinks carrying cash is not actually the major problem of the Nigerian economy with almost zero production. The color, shape and redesigning of the national currency is the least problem of the economy, and the ease, of doing business.
Our currency, the naira is on the same trajectory as the Zimbabwean currency where you will carry a cart load of cash just to buy vegetables.
Cashless economy has unique characteristic features such as reasonable literacy level, good and efficient banking system, power, internet connectivity which are grossly in short supply in our system. The literacy level in Nigeria may be well above average. The banking population may as well be reasonably high but there is no accurate statistical data on the segment of the population that operate bank accounts.
Most people in the informal sector of the economy, Small and Medium Enterprises (SMEs), the poor traders in our markets across the country do not find banking convenient enough and so prefer to patronize the traditional banking system ‘Adashi’ (a contributory system of keeping money) with an appointed agent they trust and pay out the contributed money over a specified period to beneficiary as arranged. On the use of internet and other electronic transactions as means of exchange of value which the cashless economy revolves for the purpose of the ease of doing business, it is predominantly amongst the elites and urban traders and entrepreneurs, besides civil servants. On connectivity and availability of network, it is highly epileptic and unreliable thereby causing unnecessary stress and delays in transactions. Among rural folks, banking has not been embraced with confidence as they still perceive the integrity of banking with suspicion. The demographic spread of literacy level in Nigeria is a matter of speculation; the same is true of banking population which is predominantly among the elite. There is no verifiable data collection on anything official in Nigeria as there is always the issue of integrity and politics to every official documentation and data collection.
How many Nigerians are covered in the banking networks in the banking system? The artisans, vulcanizers, the akara and pepper and sugarcane hawkers both in the urban and rural markets know next to nothing about banking. Food vendors, yams and grain and firewood sellers in most of rural communities may be put out of business when you put withdrawal ceiling of N500,000.00 per week, that’s for those that even operate bank accounts including big time traders in the urban areas.
A sizeable percentage do not have or operate the Point of Sale (POS) machine due to inherent failure and cyber frauds that are common in place because the operating networks system are susceptible to hacking and manipulations. This is in addition to the ghost of network failures in the banks.
You cannot achieve a cashless economy in a system that is bogged down by power and network failures and fraud and in a predominantly illiterate population. The greatest headache you can get is using POS in business outlets is when after transactions, you are greeted with transaction decline only for your account to be debited and to get it reversed becomes the same Nigerian malaise of business frustration.
The icing in the frustration is when you go to the customer care service of your bank where you are referred to, you join an endless queue waiting either for network to improve or the bank staff is the lazy type that has no regard to your predicament or confronted by very rude in-disciplined young girls with poor manners that originated from wretched homes with little or no training in courtesy and social etiquette.
Ours have remained a cash and carry economy driven by petty traders on hand-push carts, lock up stores and those who display their wares on the roadsides. This includes tomatoes and pepper sellers who do not even have access to mobile phones and banking is a dream luxury to them. Experience in our banking system discourages online transactions of any kind even with the convenience that is associated with cashless transactions. If you have ever experienced frustrations of transfers and transactional trade on the net, you will dismiss the cashless policy as a ploy to kill the business of the SMEs in their millions and collapse our economy completely. Putting weekly withdrawal limit for individuals at N500,000.00 will stifle the foundations of trading concerns in the major hub of the economy.
Re-designing and changing the color of the Naira is cosmetic by all standards and does not go far enough to address the basic problems confronting the economy and the value of the Naira against major trading currencies of the world; it is academic and elitist. An economy should be founded and driven by a sound policy of production with sustainable energy sources.
But here we are where common refrain in internet connectivity is, ‘no network’ please try again later. To sustain the tempo of business, you need continuous cash flow.
We cannot lift anybody out of poverty with the current policy on transactional business in cashless economy which erects barriers and obstacles in business. The traders selling and buying grains, garri, yams, okpa, zobo and vegetables cannot use the POS. we are going to usher-in more hardship to general citizenry struggling to eke out a decent living.
Tracking terrorism financing, ransom payment and illicit money is not a cure all for the economy which probably is the strong point for the new policy. It may only impact on security which in the first place is being dealt with half heartedly. The cosmetic change, rebranding and repackaging of the currency should be the least of solutions to the free fall of the naira. Our major problem is that we have never had the opportunity of getting cerebral, innovative people and technocrats to help us drive our economy. We have always had pedantic scholars parroting western economic theories and models in our peculiar traditional economy. Government relies on borrowing and handout and handover our economy to the same neo-colonial administrators to dictate what area of the economy we should develop.
However, at the end of the day, monies borrowed and aids received fly into private pockets of corrupt officials and debt servicing. Without deviating from our focus, the government should take a second look at this current cashless policy prescription and it will be noble to reverse itself if the overall good will visit more hardship on the people and will not advance our economy and lift people out of poverty.
It is time to face the hard issues that will advance our country not cosmetic monetary policy of the color of the Naira and withdrawal limits. It has been a most traumatic year, but thank God we have almost made it alive, Viva!
Muhammad is a commentator on national issues
