Kuku: Our Cashless Policy Will Boost Airports’ Development

The Managing Director/CEO of the Federal Airports Authority of Nigeria (FAAN), Mrs. , speaks on the gains of the full implementation of cashless policy at airports, insisting that it will boost infrastructural development among other gains. Chinedu Eze brings the excerpts:

The Way Forward

We actually introduced a cashless policy on revenue collection last year. That was about July or so and we intensified the process in October. This year, we’ve seen quite a number of policy directives from the federal government asking us to stop cash-based activities.

There are actually two circulars that had been released by the federal government to this initiative. Now, if you look closely at our airport environment, I think Lagos and Abuja are two biggest markets, followed by Kano and then Port Harcourt. Lagos and Abuja are quite interesting.

In Abuja, most of the passengers going towards the airport area are using the airport as their end destination. There is a small community to the right, but I wouldn’t say that all of them are mobile. I would say that is a big contrast to Lagos.

In Lagos, if you look at the positioning of the Lagos toll gate; it is actually to the right of the international airport, where you have commuters who are either transitioning from international to domestic terminal or you actually have people who are going to other parts of, you know, Ikeja Oshodi, Isolo; unlike most of the other airports around the world where they have a 13-kilometre radius, the Lagos airport is actually positioned in communities.

Of course, in the implementation of the cashless policy, it made it quite hectic because a lot of the commuters and even some of the passengers, despite a lot of the awareness, did not believe that we would actually start the enforcement on March 1, 2026. It did create a huge bottleneck over the first few days, but we saw that it actually started to ease up. I gave some interviews where I reeled out some data from October where we actually started the implementation to March 3.

We’ve registered about 100,000 customers of which 62,000 of those were actually done in the last three days. In Abuja, for example, we saw the traffic start to ease up. But despite that, we are an airport. Our ultimate goal outside of safety and security is also to make sure that our passengers and the neighbouring areas have a seamless experience. We’re grateful to Mr. President. He was able to step in.

Adopting Hybrid System

For him (the President), it wasn’t just about implementing a federal government directive. He understood the uniqueness of the airport environment and realised that if we implement the policy without looking at a broader picture, some of the infrastructure challenges that the airport has, things around potentially widening the lanes, improving or increasing the number of payment channels that we had, we will continue to have a challenge. And in his right full mind, within the Federal Executive Council, we did get a waiver that allowed us to do both hybrid, meaning that we will continue to use some of the contactless cards that we have put out for non-cash payments, but we can use cash until we get a broader view in terms of the number of people who can actually use contactless payments so far.

I consider this a big win for the industry because it gives us more time to pilot, transition and put in the necessary infrastructure. Now, that is important. That’s getting to the big picture now, what we’re trying to achieve.

Because I look at this as trying to hit an elephant and where do we start from talking about our regional home foundations and also the rehabilitation of the airports here. And I’m thinking how do we compete, where do we start and how are we getting there. So, Nigeria, and especially the Murtala Muhammad Airport is one of the busiest airports across Africa.

Attracting More Travellers to Nigeria

But I will start by saying that if you look at the likes of Cairo, look at the Cairo International Airport and then look at the Oliver Tambo in Johannesburg, they’ve done something that works extremely well. So, look at Oliver Tambo, look at Addis (Bole Airport in Addis Ababa) and then look at Cairo. What works extremely well for them is the fact that they’ve not just made their airports a destination for passengers who are coming into their country, but they’ve made it a hub.

And what does that mean? A lot of people use the terminology hub very loosely. A hub is literally an environment or an airport environment where you’re able to have transit passengers move from one location to the other without necessarily making that country their end destination. In Nigeria, for example, when you look at the key factors that drive passenger traffic, the biggest is GDP.

When you look at the GDP of the Nigerian population and you compare it to our passenger traffic, it’s actually very low, it’s less than 2%. And what that means is that a lot of the passengers that are a lot of the Nigerian passengers are not traveling in contrast to all of the other areas. For us to be able to drive passenger traffic effectively, it means that you need to do a couple of things.

One, you need to either improve the business environment where there’s a lot of trade activities happening that brings people into the country or even the economic activity. So whether it’s tourism, or business activity, when we start to look at the hub, we really see the future in two things.

One is in driving the hub strategy and the second is boosting passenger and cargo volumes. To make the hub strategy effective, a couple of things need to happen. It’s not just about developing an airport or building infrastructure.

But it really requires that we look at the enablers. And what are these enablers? For example, look at the airlines. So, for us to be able to increase our aircraft movements and have additional points of entry, we look at the bilateral air service agreements that we have with other countries.

Transit facility at Lagos Airport

I believe that in this administration of the last three years, the Honourable Minister has actually improved the number of routes in terms of airlines that are going outside of the country and also being able to come into the Nigerian market. But what that also means is that as we start to say we’re driving a hub, one, you need to make sure that there’s a transit area. Today, within the Nigerian airport, it’s quite difficult for you to transit because there’s no transit facility.

And this is actually one of the things that we’re doing as part of the rehabilitation work that is going on. Honestly, I did a 22 to 24 months’ timeline given here and also with some fire incident that happened recently.

Fire Incident Will Not Stop Airport Rehabilitation

We had a fire incident that happened last week. I believe it was last week Monday. It did have a bit of an impact, but I would say that it was minimal. The impact was really on some of our technology that we were moving. The good news, however, is that we were actually planning on leaving that terminal. Wednesday (March 4th) was the last day for us to leave the terminal. So, it’s just about a little setback. We had manual operations and manual checking for about four or five days.

We’ve now been able to restore our operations back to normal. Now, in terms of the rehabilitation itself, yes, the 22 to 24 months still stands. As of November, if you’re passing through the airport area, we actually have now activated the temporary terminal. There’s a temporary terminal that has been built. There are four airlines that have moved into that terminal.

So, Middle Eastern, I believe Air France, KLM and Ethiopian have moved in there. This is a temporary facility that was built within a three-month period. We did a tour of that facility very recently. We do have alternate routes that have been built into the temporary terminal. If you notice, there’s a bridge that has been built because part of the rehabilitation works is also the entry and egress from the airport as well. So, we’re, of course, with the 22 to 24 months’ timeline.

At the end of the day, when you look at the airport experience, it’s all about how the passenger feels from the beginning to the end point. I’m trying to imagine what you’re trying to do because that’s the real test of all the reforms that I’ve seen out here. I’m trying to imagine how you’re looking at this and how you plan to execute that.

Passenger Experience as Priority

One of the things that we did, as I mentioned earlier, it’s not just about designing an airport. You basically designed an airport from inside in. The first thing you mentioned was about passenger experience.

What we did was to look at the entire passenger journey from when you’re approaching the airport environment; whether it’s the passenger drop off or cargo, but when you come inside you will notice that since last few months, we’ve actually redesigned some of our airport operations, and that has also been incorporated into the new design that allows improved passenger flow, where you’re potentially able to check in and even using certain touch points.

So, it’s not just the infrastructure; we are looking at how we can leverage technology to improve the touch points, e-gates biometrics. Right now, you have the biometrics and the e-gates being used on entry. We’ve incorporated biometrics on exit as well, which is incorporated into the new design. So, all of those are things that we’re considering heavily. But I think the big win for us will also be the transit facility that is being built and incorporated into this new design.