THE Lagos Chamber of Commerce and Industry (LCCI) has asked for more time for the implementation of the cashless policy. In a statement, its Director- General, Muda Yusuf said the latest Central Bank of Nigeria’s (CBN) circular should have given a much longer notice to economic players, including enlightenment. He said the effective date is extremely short as the circular was dated September 17 with effective date of September 18, noting that it is just a notice of one day.
According to him, “This would have short term disruptive effects. We implore the CBN to give at least two months to allow for players in the economy to adequately prepare themselves. This is particularly so for investors who are major players in the retail segment of the economy. It is difficult to justify the decision to penalise cash depositors. The emphasis should be on discouraging cash transactions and withdrawals, which is more in consonance with the objective of the policy.”
Yusuf said the cashless policy is no doubt a commendable initiative which has impacted significantly on the economy but insisted that financial institutions should continuously strive to raise the level of confidence of citizens in the electronic payment platform. The LCCI chief said this would entail the reduction in ATM fraud, internet fraud and other fraudulent activities on the various electronic platform. He called for more enlightenment and incentives to encourage the citizens to use electronic payment systems. According to him, the transitioning process requires robust enlightenment, consultation and stakeholder engagements.
Also, the Nigeria Employers’ Consultative Association (NECA) says the country’s economic environment is not ripe for full implementation of cashless policy, as recently announced by the Central Bank of Nigeria (CBN). The association’s Director-General, Mr Timothy Olawale, who made this known on Thursday in Lagos, said that the full implementation of the policy would impact negatively on several sub-sectors of the economy.
NAN reports that although Olawale said that the initiative was laudable, he however, noted that the current business environment and the available infrastructure were not ready for such a development. “Several sub-sectors of the economy, including the fast-moving consumer goods and retailing, downstream oil and gas, and transportation, among others, will be negatively impacted by the policy, as they are still predominantly cash-dominated.
“Corporate account holders are still battling with the N50 stamp duty charge on every transaction above N1,000, commission on turnover of 0.1 percent, with the about-to-come-on-stream 7.2 percent Value Added Tax. “Also, with the additional five percent as processing fee for withdrawals and three percent as processing fee for lodgements of any amount above N3 million, it is needless to say that the policy is an overkill, exploitative and will impact negatively on the citizens,” he said.
The director-general said that the country’s 2019 Doing Business Report rated Nigeria 146th out of 190 economies. Olawale said: “this and other uncoordinated and unplanned policies will further bring hardship on the people and lead to further contraction of the economy.”
He called for the exemption of the aforementioned sub-sectors, if CBN must still go ahead with the cashless policy. He also urged the CBN to ensure that all deposit money banks improved their facilities as against inefficiency in our payment platforms to reduce incidences of fraud. Olawale reiterated the need for wide consultations and stakeholders’ engagement on a continuous basis before the implementation of policies.
By Okwy Iroegbu-Chikezie and Esenvosa Izah
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