CBN Cash Policy

The reduction of the usage of cash in Lagos may seem a welcome development to policy makers however the question we should ask are these:

• How prepared is Nigerians, since they are the ones that would may need to change from using cash which they are traditionally accustomed to in their daily transactions of buying and selling of goods and services?

• IS the necessary laws in place to back up the new policy of Govt.?

• Are the security agents equipped in terms of requisite professional skills, hard wares and software to handle issues relating to a technology driven economy?

These are some challenges that needs to be look into to ensure a hitch free transition from a cash based society to a society that depends less on cash.

There is no cashless society anywhere; The US, Europe, you name it-but society that discourages the excessive us of cash in transactions.

Nigeria cannot afford to be left behind technologically. Aside from the reasons the CBN gave for introducing the new cash policy:

• High cost of cash
• High risk of using cash
• High subsidy, and
• Informal Economy
• In pursuant of the Vision 2020-20 of the Federal Government of Nigeria transformation agenda( ..the economy) by:
  
  1. Reducing the cost of banking services.
  2. Reduce inflation caused by excessive cash in the system.
  3. Curb inefficiency and corruption we hear now and again

When you Consider the cost of producing cash, one wont be surprise to find out that the cost of making a ten Naira, transporting these note to where it is eventually used and the cost of making new notes to replace worn out notes may exceed the actual value of a ten Naira note.
Have you considered how many hands a particular notes go through before it becomes unusable? My guess is less than 10.