By Babajide Komolafe

The Central Bank of Nigeria (CBN) isto license independent firms to roll out Point of Sale (PoS) terminals across the country, in a bid to ensure effective implementation of the limits on cash transactions.

“We will soon appoint companies that will roll-out PoS across the country. They would deploy PoS in all the merchant locations, markets and wherever mass sales take place”, Muhammad Nda, Director, Currency Operations Department, told Vanguard.

It will be recalled that two weeks ago, the apex bank, in a bid to reduce high usage of cash in the economy, limited the amount of cash that individuals and corporate bodies can deposit or withdraw freely from their bank accounts per day. Under the new policy which will commence June 1st 2012, individuals that make cash withdrawal or deposit above N150, 000 will pay a fine of N100 per extra N1000, while corporate organisations that make cash withdrawal or deposit above N1 million will pay fine of N200 per extra N1000.

The policy, which would be enforced in Lagos State, Abuja, Port Harcourt, Kano and Aba in the first phase, also banned encashment of third party cheques above N150,000 across the counter.

Though industry operators see it as a good development, members of the banking public, however, criticised the policy saying it will discourage banking habits and encourage people to hoard cash.

“The policy will discourage traders from patronising their banks”, said a plastic dealer with Sunarts Plastics at Ota who simply gave her name as Madam Cash.

‘’Before the existence of banks, Nigerians had a way of keeping their money and the new policy from CBN will remind them of the old system of keeping money. In other words, armed robbers will start going from house to house to collect money from those who keep it at home,’’ she said.

“The way forward in my view is not to penalize the people for the use of cash. It would be most unfair to do so”, said Muda Yusuf, Director-General, Lagos Chamber of Commerce and Industry (LCCI).

“Rather, the level of confidence in other payment systems should be drastically enhanced through reduction in ATM fraud, internet fraud etc; the cheque clearing period should be significantly reduced; there should be incentives for the use of non-cash payment systems. There should be consultation and enlightenment of stakeholders. Transformation by fiat will cause serious dislocations in the economy and slow down the velocity of business transactions. It would also create serious queuing and congestion problem in the banking halls. We need to put the issues in proper context,” he said.

Responding to the criticism of the policy, Nda said the aim of the policy is to discourage the use of cash by providing alternative payment channels in the form of Point of Sale (PoS) terminals.

He said the apex bank will achieve this by facilitating massive deployment of PoS across the country. He said for this purpose, the apex bank will soon appoint independent PoS deploying firms that will be licensed solely to deploy PoS.

He said the licensing of the companies and deployment of PoS will take place in the next one year such that there would be adequate PoS coverage in the cities designated for the first phase before the policy commences in June 2012.

He said that under the new dispensation, bank customers would be able to use their cards on all PoS irrespective of their bank or who deployed the PoS, adding that all PoS and payment card switching platforms would be interoperable.

“Before now, people were not used to using ATMs but now, they have accepted ATMs to the extent that some banks have placed restrictions on cash withdrawal across the counter asking customers to use the ATM for transactions below specific amount.

“That is why we are appointing the companies for massive deployment of PoS. They will put PoS in all the merchant locations, markets and places of mass sale so people will be able to use their card to pay just like they use it to withdraw money from ATMs.

“Also, the merchants, like hotels, supermarkets and the rest will receive little cash, and will not have to carry cash to the banks.

“If we all cooperate, people will have little or no cash to carry around, incidences of armed robbery will reduce, there will be more respect, and also people will be able to make purchases and payment online,” he said.