This is one of the best policies this administration has formulated and is delivering on. Of course, people will cry and shout but it is in the overall best interest of the nation.
Already, one of the presidential candidates that has been alleged to use huge sums of money to buy votes and mobilise thugs to force people to go his way, is attacking President Muhammadu Buhari, his own party leader, because of this policy. It could therefore be summed that the policy is clearly not self-serving or in the interest of the party. It is altruistic!
Bandits, fraudsters (AKA 419ers) and terrorists trade with huge quantities of cash – which they collect as booty or ransom, purchase arms and properties with, and return to terrorise or oppress the people. In Nigeria now, excess cash in the system equals easy access to cash by terrorists and criminals, and undeterred access to it equals lack of peace.
The economy has been facing serious challenges because many people have deliberately refused to be included in the mainstream banking sector, even with the introduction of easy banking services -which include on-the-spot accounts opening and withdrawal though the POS and other mobile channels.
By running away from banking services the country cannot calculate adequately its Gross National Product or Gross Domestic Product, or its per capita growth.
It simply implies that what Nigeria has been doing is guesstimating its GDP, GNP and other growth indices. That is probably why our titling as the largest economy in Africa has had little impact on the life of the average citizen.
Have you ever tried, as a business owner, to secure a bank loan? Well I have. And it is harrowing.
Traditionally, banks are supposed to trade on the confidence they have on the characters of everyday individuals but in Nigeria they do not! One of the reasons is that they are usually unable to track adequately, what borrowers do with loans. Some people use the loans for other purposes – not what they applied to use it for, and dodge the banking sector by trading in cash continuously. Loan recovery, in order to recirculate money and empower others to start or grow their businesses, therefore, becomes impossible.
Are you aware that the Covid19 NIRSAL loan disbursement suffered because deposit money banks, DMBs, which finance the loan from their profits, withdrew because they were not posting profits?
Do you know that many positive and shiny balance sheets posted by banks annually are doctored, because they do not make profits from production activities; rather they make ‘doubtful’ profits from moving money from one place to another and charging commissions on them?
With more money in the banks the banks will be forced to lend more at friendly rates because they will be able to track how lenders use the money in order to make informed recovery decisions. Recently, a former accountant general of the federation was accused of a total graft figure of N109bn.
The late former Chief of the Air Staff was reported to be removing N600 million every month from the monthly allocation to the Air Force. These allegations of senseless criminality could only be conceived because all transactions are not forced to take place through the banking system. At a point, money changers became the ones determining and creating new but poor values for the Naira! That should not continue.
Counterfeiters will be forced to stop, however briefly, because Nigeria is moving into semi-cashlessness. The less the importance of cash, the less the activities of these people. Imagine being paid, as a farmer for several bags of grains in mint currency that are counterfeits! It has happened and could happen again. I can go on and on.
This policy is one of the very best policies Nigeria has ever had. If the government wants it to work better all it needs to do is to withhold huge supplies of the new currency to the banks and collect much more old currencies from the citizens in order to stop inflation and criminality in its tracks.
If someone kidnaps another today and asks for N3m ransom – which will take forever to gather because withdrawal limits have been reduced and payouts from accounts tracked, he, the kidnapper, will gradually pull out of that way of life!
And how does the terrorist get more money to buy arms if the banks do not allow excess cash in the hands of people who he will kidnap for a ransom? Yes, we will suffer and complain. But like all giant steps that must be taken, the initial discomfort will lead to a good ending.
In fact the biggest saboteurs of the banking and financial reform going on are the legislators at the National Assembly who called for a review of the withdrawal limit upward. What is wrong in doing bank transfers for all transactions? A country like Nigeria, where almost everyone in public office is stealing, needs to go totally or partially cashless so that all transactions can be tracked and punishments and taxes properly applied and extracted.
The villager and local trader will now be properly included in the banking sector, with this new policy. And soon, we will all realise that those petty traders and farmers who we see as uneducated can actually transact without keeping cash.
Let’s endure the discomforts of this policy and currency change in order to live a better and safer life as Nigerians.
We need a better global reputation that will attract huge foreign investments. This could be the magic wand!
Balogun, a media consultant, writes from Abuja via 08069727798
