Governor of the Central Bank of Nigeria (CBN)Godwin Emefiele, says the adoption of the cashless policy is in line with the apex bank strategy to eradicate fraudulent activities in the Nigerian banking system.
Emefiele explained that the policy was not intended as a strategy to disenfranchise businesses as being speculated by Nigerians.
The apex bank, had in a circular dated September 17, 2019 titled, Re: Implementation of the Cashless Policy, addressed to all Deposit Money Banks directed that as from September 18, lodgment of cash by individuals that is above N500,000 will attract 3 per cent processing fees for withdrawal and 2 per cent processing fees for lodgments.
For corporate bodies, it said, withdrawal or deposit above N3million will attract 5 percent processing fees or 3 per cent processing fees.
However, the CBN governor while addressing journalists on Friday in Abuja after the Monetary Policy Committee briefing said that cashless policy was first launched in 2012 and not a new initiative in Nigeria.
He explained that Nigeria full adoption of cashless policy is in line with the Section 2 (d) and section 47 of the CBN Act as it would promote an efficient payment system that will end charges incurred from cash processing often passed on to customers by Deposit Money Banks, increase transparency in financial dealings and reduce fraudulent activities including ransom payments, extortion and cyber fraud.
Emefiele revealed that at the inception of the policy, that there have always been charges on deposits and withdrawals.
However, “Because there was lots of cash outside the banking industry we decided that there was no need to penalise those that wanted to bring in their cash from outside the banking industry into the banking industry, therefore, we retained the charges on withdrawals and relax charges on deposit.
“After five years, we expect that all the cash that was outside the banking system has been returned. So we think it is time to fully kick start the cashless policy” he explained.
Emefiele also explained that the implementation of the new Value Added Tax (VAT) is a government strategy of raising revenue to meet its obligations which includes the provision of good roads and proper electrification in the country.
The charges on deposits would be in full effect by March 2020 across all states.
He also confirmed the apex bank will no longer provide foreign exchange for the importation of cassava and its by-products. This development comes few months after Nigeria placed a ban on forex for milk importation also.