The Challenges of the Cashless Policy In Nigeria and Recommendations -To be or Not to be”.


Michael Ife.

It is a widely held view that the pilot phase of the cashless policy of the Central Bank of Nigeria (CBN) failed,due to the several number of challenges facing the cashless policy in Nigeria. But the apex bank has dispelled such opinion, saying the policy recorded success even as it was suspended. According to the CBN Governor, Mallam Sanusi Lamido Sanusi, the policy led to a general behavioural change in the way business is conducted in the country.

However, Nigeria’s cashless policy faces several challenges including poor network connectivity and debiting customers’ account twice, high transaction charges, PoS machine malfunctions and other technical issues.These challenges have discouraged customers and resulted in a slow adoption of the cashless policy, Today we shall look into these challenges one after the other either  to agree or disagree in one accord in respect to our previous article stated “Cashless Policy in Nigeria – To be or Not to be”.

 Challenges of the Policy and Recommendations

1) Poor Network connectivity and Communications Due to vast number of people using the cell-phones, Telcos (Telecommunications company)  pay more attention to voice clarity services rather than network connectivity. Thus, network availability is inconsistent. This makes for slow access to the internet through all mediums other than cell phones. This is because the Telcos make more money on voice than data. People make use of their phone in making calls than in browsing, hence the Telcos put more effort in creating an adequate platform for clarity of voices services contrary to data usage and connectivities.

RecommendationThe Telcos (Electronics & Computer Science / Telecommunications company) should guarantee network availability and quality at all times. The Federal Government should make a policy that will determine the Telcos to always endeavour to ensure proper and quality availability of Network Services both in Voice and Data Usages.

2) Infrastructure deficit The financial infrastructure in Nigeria is not adequate to carry the load of a cashless society; ATMs, Point of Sales system, kiosks, mobile, web and other mediums have to dramatically expand to touch at least 40% of the whole economy before any meaningful effect can be achieved.

Recommendation: Adequate and well-functioning infrastructural facilities must be in place. More specifically, issue of electricity should be tackled by the government to facilitate the usage of electronic money, Individual and collective analysis should be made of the various e-banking channels to determine relative impact on the economy.

3) Security Recommendation

To prevent theft, armed robbery and miscelleneous habits by Bankers, CBN should work hand in hand with legislatures As it relates to laws that are need to enforce new methods of transactions and a changing culture, the CBN must partner and work with the National Assembly to ensure proper legislation is been formulated. Enforcements of new legislation would be carried by the CBN and all other executive arms that are empowered such as the EFCC. They must commit to training of personnel and the judiciary must be prudent and up to the task.

4) PoS machine malfunctions and other technical issues

The manufacturers of the Pos machine or the distributors  should ensure with adequate hands in the field to make provision for replacement of the Pos machine when necessaries and always available in tackling several technical issues that may result in the machine in course of usage. again, Fair competition should be allowed in order to prevent monopoly-like‘ behaviour by the licensed POS manufacturers.

5) Debiting customers’ account twice and  high transaction charges

Customer may be debited twice in course of transaction while using the ATM’s machine. This could be caused due to poor communication or signals  in the ATM’s machine or likely the Pos software malfunctions.


Banks should always endeavour to Re-traverse any of her customer’s account that was debited this should also be done with immediate effect at-least within 3-hours interval, Fund transfer should also be within the 0.3% Vat as by the CBN recommendation without any contradiction from any Banks so as  To encourage Nigerians to patronize such cashless banking channels, the cost should not be too high as a larger percentage of the population experience poverty.


From the above informations injunction with the recent post,If an effective cashless banking system can be developed and the above recommendations are carried out then it will have desired impact on the Nigerian economy. Therefore it is strongly believe that the above recommendations could act as a catalyst in speeding up the rate of the Cashless policy.

To this regard we can then obviously answer the question earlier stated “Cashless Policy in Nigeria – To be or Not to be”.

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    • osunkwo f.o.chinyere
    • March 13, 2015

    This policy is a convenient way of exchange, but the level of awareness is very poor.

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    There should be stronger and more protective policy from authority, and consider this more as a social welfare project than a profitable project, at least at this stage. Some useful experience should be taken as reference but concrete measures should fit reality of this country. in my opinion CBN and NIBSS should transfer their role to a service provider and release more incentive policies to all players of this industry.

    • Ella frank
    • May 6, 2014

    This is a very nice post on the above topic…,with very realistic recommendations for solutions in every area of challenge mentioned!…am an economist..still in my incubating process though!…and I admit that ur post is fabulous!..I even borrowed some of your ideas for an assignment!……thank you,!

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