BY PETER EGWUATU

The Managing Director/CEO, Oceanic Bank International Bank Plc, Mr. John Aboh has explained the need for Nigerians to embrace a cashless economy which is being championed by the Central Bank of Nigeria (CBN).

He stated that a cash economy encourages corruption and money laundering, stressing that heavy reliance on cash transactions may also make terrorism thrive as audit trails are easily truncated once the cash leaves the system.

Addressing bank auditors in Lagos weekend, Aboh noted that the cost of printing notes by the CBN is on the high side, just as with the banks in maintaining cash management.

According to him, Banks are spending much in cash management, as staff that handles cash transactions account for about 20 per cent of the total workforce. So while the challenges of issuing notes were making that choice more daunting, electronic payment channels were increasingly becoming more acceptable as alternative means of payment because of advancements in Information and Communication Technology (ICT) in Nigeria.

He elaborated that the major objectives for CBN move for cashless economy was to reduce dominance of cash, reduce cost of cash printing and increase electronic banking channels transactions, adding that any customer who still wants to use cash has liberty to do so provided he or she is ready to bear the cost (penalty).

According to him, “The CBN had fix a daily cumulative free cash transaction (withdrawals and lodgment) limit of 150,000 for individuals and N1 million for Corporate bodies; Impose N100 per mille penalty for deposit and withdrawals above the daily cumulative limit for individuals and 200 per mille for corporate; Impose a fine on banks for waiving the penalty above for their customers; Banks to ensure that that third party cheques above N150,000 shall not be cashed over the counter, that is, must be through clearing.

Explaining further the CBN’s policy thrust on the cashless economy, he noted that the apex bank had stated that any bank that contravene the policy shall pay fine of 10 per cent of the face value of the cheque or N100,000 which is higher.

According to him, Banks shall no longer do cash -in- transit services to merchant customers. Customers could engage the services of CBN licensed cash -in -transit companies. A fine of N1million per specie movement for contravention.

Continuing, he said the CBN is already creating a conducive environment for the successful implementation of the policy as the pilot run is expected to kick-start in Lagos, Abuja and Port harcourt.

In this regard, the Oceanic Bank boss called on Nigerians to support the CBN in its quest to transform the banking sector through cashless transactions as it is operated in developed economy.