HOW will the decision of the Central Bank of Nigeria to limit amounts that could be spent on cash transactions affect the governments? The attention of the CBN has so far been on individuals and corporate organisations.

In what ways would the limits affect governments? Will governments be exempted? Who will stand for governments in terms of implementing the limits? Are governments’ daily transactions possible with such limits on its expenditure? How would the CBN ensure that there are no abuses in whatever concessions it makes to governments?

Governments’ role in the cashless economy must be spelt out clearly and early enough. Those who are responsible for implementation of these roles must be known. All the efforts so far made to ensure that governments, their ministries, department and agencies adopt the electronic transaction (cashless) in their payments have been partially successful. Government officials are not enamoured to any suggestions that would lessen the volume of cash they could spend.

Recent reports of violent robbery attacks on vehicles bearing cash to government houses lend support to the concerns about how governments will manage their daily cash transactions when the CBN directive becomes effective.

Cash movements place the lives of people in danger. Criminals, most likely working with insiders, have information about the movement of money and can strike. Individuals have been similarly attacked when they make huge cash withdraws. Loss of huge amounts of money affects the losers, stalls development and fuels more crime. The criminals could use their loot to buy more sophisticated equipment to launch more dangerous attacks.

Promotion of other forms of payment and enforcement of laws against bounced cheques could achieve more results than legislation.  Banks have to increase and improve their services, particularly in the rural areas. Most rural bank branches do not have facilities to process other payment options or to execute decisions that affect bank customers without any considerations for where they are located.

Some factors make cash robbery more attractive. Success is mostly guaranteed. The robbers have information up to the arsenal available to those guarding the money. They have a fair idea of the worth of their target. The most attractive aspect of the crime is that cash is easy to spend without traces of its source.

The availability of money in larger denominations makes it easier for the robbers to disperse their loot unnoticed. There may also be need to change the methods banks use in moving cash. They make too much ceremony of what is meant to be a high security operation. Sirens are banned for bullion vans, but the non-enforcement of the law sees bullion van drivers and their escorts bullying other road users and drawing lots of attention to themselves by blaring sirens.

Governments should be top priority for CBN for the planned cashless economy to work. Governments spend more money than everyone else. Their examples in adopting cashless payment options, will minimise the number of robberies linked to mass movement of cash and could be the crucial first step towards weaning Nigerians of their affinity to cash.

CBN cannot be talking about sanctions for violating cash withdrawal limits on when it is not talking about stopping governments from using cash in most transactions.