About 90 per cent of the nation’s banking public currently subsidise the high costs of cash-based transactions incurred by the 10 percent privileged who are the high end users of cash in the system.
This is even as the Central Bank of Nigeria (CBN) has said unless 90 percent of the banking population will continue to subsidise 10 per cent of the rich that withdraws above N150,000 per transaction.
A recent survey carried out by the Central Bank of Nigeria (CBN) has shown that 10 per cent of the banking public accounts for majority of the high-value transactions while only 10 per cent accounts for daily banking transactions above N150,000, indicating that the bulk of the banking population (90 per cent) pay for the high transaction cost that the tiny majority incurs in terms of high cash usage.
The meaning is that, the more money you transact, the less charges you pay, whereas the ‘small bank users’ are made to pay much for the small amount they transact in.
The CBN Governor, Sanusi Lamido Sanusi, who disclosed this in Akure yesterday said the cashless policy will bridge the gap, thus the small bank clients will no longer subsidise the small banking population that do big transactions.
“There is a subsisting myth that the cashless policy will hurt the low income groups adversely. In truth though, many of them cannot, with the volume of their transactions qualify for the costs that the cashless policy attracts”, he said.
Speaking at the ongoing Seminar for Finance Correspondents and Business Editors, yesterday in Akure, Sanusi, who was represented by an executive member of the CBN board, Professor Sam Olofin, said that the cash-less policy would help achieve the CBN’s objective of expanding, deepening and modernising the payments system in Nigeria and also galvanise the CBN in ensuring that Nigerian ranks among the top economies of the world in line with the nation’s Vision 202020 aspirations.
This policy would also impact positively on economic growth and development.
In line with the cashless policy, the CBN said it has embarked on the financial inclusion policy which target is to add 50 million new depositors to the current number of the formal banking public by the year 2020.