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MasterCard says cashless policy will reduce cash transactions by 70%

By BusinessNews Staff on June 6, 2014

MasterCard has predicted that the planned nationwide roll-out of the central bank’s cashless initiative will reduce cash transactions in the country by 70 per cent.

Vice-President and Area Business Head at MasterCard, Omokehinde Ojomuyide, gave the hint in Lagos recently. She told THISDAY that although the initiative aims at reducing cash flow in the country to the barest minimum, without actually eliminating it, current indices on ground, coupled with the rate at which Nigerians are adopting the initiative, show that the country will achieve 70 per cent cash reduction in no distant time.

She said the volume of electronic cash transfers has risen in recent times and that the challenges of accessing funds by the unbanked have reduced since the introduction of cashless policy in selected states in 2012.

She commended the efforts of CBN in engaging financial institutions like the Electronic Payment Providers Association of Nigeria (EPPAN), and Intermarc Consulting, to embark on grassroots sensitisation on the benefits of the cashless policy.

“Some financial institutions engaged by CBN are currently taking the cashless initiative to the nooks and crannies of the country, to raise awareness on cashless economy among Nigerians living in the urban and rural areas, in preparation for the nationwide launch of the initiative. This is commendable and will further deepen the adoption of cashless by Nigerians,” Ojomuyide said.

She added that MasterCard, Nigeria Inter Bank Settlement Scheme (NIBSS), and several financial groups were solidly behind card and mobile expo slated for June 17 to 19 in Lagos, insisting that the organisers of the expo will use the platform to further drive cashless initiative.

She listed some of the challenges in accessing bank funds in rural communities to include limited number of bank locations in rural communities, and high bank loan rates, but assured Nigerians, especially those in rural communities that the planned nationwide introduction of cashless policy would address all of that.

“The unbanked pays more to access funds than the banked. So to improve their lives, we need to bring them to be part of the financial inclusion,” she said adding that “financial inclusion is on our mind and we will help to address the challenges of electronic transactions, both in the rural and urban communities.”

Lamenting the poor state of infrastructure that would have helped enhance the cashless initiative, Ojomuyide called for wide spread deployment of telecoms infrastructure on which electronic transactions ride upon.

Industry stakeholders had earlier called on government to as a matter of urgency, build a national broadband backbone infrastructure that will address data communications in the country.

Nigeria currently has huge broadband capacities that are clustered on the shores of the country, but lacks national backbone infrastructure to transmit the capacities to the hinterlands.

Worried by the situation, President of the Association of Telecoms Companies of Nigeria (ATCON), Mr. Lanre Ajayi said less than 10 per cent of the huge broadband capacities at the shores of the country were currently been utilised.

He equally joined forces with those clamouring for the establishment of a national backbone infrastructure in the country, a situation, he said, would further drive cashless initiative.

[This Day]

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