CBN Plans Incentives for Traders to Drive Cashless Policy

19 Nov 2012

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CBN Deputy Governor, Tunde Lemo

By Crusoe Osagie

The Central Bank of Nigeria (CBN) has disclosed plans to introduce incentives for traders through commercial banks in order to drive the cashless policy recently introduced in the country.

The apex bank also revealed that the cashless policy, which was kick-started in Lagos State, will soon be implemented in other states of the federation with more extensive and effective awareness campaigns.

The CBN Deputy Governor, Tunde Lemo, disclosed this during a cashless policy seminar organised the Lagos Chamber of Commerce and Industry (LCCI).
Lemo stated that CBN was appraising the Lagos situation and based on the report generated from the appraisal, some far-reaching decisions would be taken to improve the effectiveness and ease of the policy on the economy.

The Deputy Governor, who was represented by Eric Yaduma of the Shared Services Sector in CBN, said a draft report has already been presented to management and after the review of the report some positive changes should be expected before the policy is rolled out to other states.

“What CBN is thinking right now is to encourage banks to introduce some incentives to merchants. We are trying to determine the best incentive schemes for stakeholders,” he said.

He also revealed that one of the thinking of the apex bank right now is to perfect the cashless policy, which had 5,000 POS outlets at inception but now has about 200,000 outlets  in Lagos before extending the policy to other states across the country.

“We are working with the Nigerian Inter-Banks Services (NIBS) to address some of the challenges we are experiencing in Lagos. We are also engaging telecommunication companies to give priority to data services in order to eradicate the network challenges,” he said.
He disclosed that the CBN was also partnering the National Orientation Agency (NOA) to improve on the awareness level adopted in Lagos “because awareness is key to the success of the policy”.

He said CBN created the consumer protection department specially to address issues related to the cashless policy and also established an e-payment fraud forum to handle fraud related cases under consumers resolution services, and added that the Nigerian Postal Services have been approached as possible outlets to promote mobile money transactions under the cashless policy.

He also disclosed that presently WHO was considering doing a pilot under the policy that would see them using the platform to pay their vaccination agents even in remote parts of the country.

Speaking at the event, the President of LCCI, Goodie Ibru said the kick-off of the cashless policy in Lagos in April this year introduced a lot of challenges and opportunities in doing business in the state.

“To help improve the policy as CBN gets set to extend it to other states, they, as regulators, should pay more attention to developing business in the e-payment sector because it is a critical sector that will drive Foreign Direct Investments (FDIs), international trade and trade integration,” he said.

The LCCI Director of Research and Advocacy, Vincent Uwani, disclosed that the Chamber carried out a three-week field survey of individuals and companies and conducting 721 interviews across all economic sectors to determine the impact of the scheme in Lagos.
He revealed that from the survey an impressive 80 per cent awareness has so far been achieved among individuals and 100 per cent among companies. He said that according to the survey, usage of POS had the potential to grow from its present eight per cent to 74 per cent if all the challenges are adequately addressed.

A cross-section of the banks present at the event unanimously submitted that problematic telecommunication infrastructure was a major challenge of the cashless policy especially with POS and mobile money platforms.

Tags: Nigeria, Featured, Business, Tunde Lemo

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