By Nnenna Ibeh

In 2012, the Central Bank of Nigeria (CBN) announced its plan to introduce a cashless policy in Nigeria. Although there was a delay in the policy's implementation in 2022, the apex bank introduced it with a move to redesign the existing N200, N500, and N1,000 notes.

This move by the CBN and the reintroduction of the implementation of the cashless policy left the country in a state of cash crunch, with many, especially business owners having to buy the naira from the point of Sale (POS) operators.

For N1,000, the POS operators charge between N300 and N500 and citizens who are in dire need of cash buy them as the banks cannot meet the money demand across the country.

According to the CBN, the cashless policy aimed to reduce the number of naira notes and coins used for business but not eliminate cash usage.

Although the apex bank seeks to ensure a seamless policy implementation, those in the informal sector and small business owners are hungry for better clarification on how to run a cashless business.

For Jane Odoh, who runs a restaurant at the Federal Capital Territory Council Nigerian Union of Journalists, the policy has brought hardship to her and other small business owners.

Odoh, popularly known as Madam Sabi, said that since the cashless policy was re-introduced, business for her has been nothing but slow.

A single mother of one, Madam Sabi confirms she has also lost money in her bid to make ends meet for herself and her son, who is preparing to sit for the West African Senior School Certificate Examination (WASSCE).

She said:

"Since they (CBN) announced the cashless policy, the business has not been going well. Many times I have lost money because customers will come to eat, and after eating. They will tell you they do not have the cash to pay."

Customers using the situation to evade payment for services

Madam Sabi, had also explained that customers now use the poor implementation of the cashless policy by the CBN to evade paying for her services - a situation which has become quite frustrating for her.

"They promise to make transfers into my account, and sometimes the money transfer will go through while at other times it will not. 

"And when you ask these customers, they say they have transferred the money and their accounts debited, but you will not receive any cash.

"These days, I appeal to my customers - especially those I do not know much - to always have their money in cash before serving them food. And many of them find this offensive, and sometimes they even walk away. We are losing business due to this,” Madam Sabi laments

Like Madam Sabi, Mama Ejiro, a fruit seller in the popular Wuse Market also appears frustrated with the poor implementation of the nation's cashless policy.

Banks not helping matters

Mama Ejiro told AMAKA that when customers claim they have made transfers to her account, she sometimes does not receive bank alerts for the transaction.

Narrating her plight in Pidgin English, Mama Ejiro said:

"Every time, they tell me to check my bank app but I do not know how. They even said that my phone could not use the app, and I do not have the money to buy those big phones (referring to smartphones).

"I have gone to my bank several times to complain, and it has just been from one story to the other; it is so tiring because every time, I leave my business to go to the bank, join the long queue, and I end up achieving nothing for the day."

NLC Kicks Against Cashless Policy

While celebrating the 2023 Workers' Day on May 1, the Nigerian Labour Congress described the cashless policy as bringing more hardship to Nigerians.

The NLC's national president, Comrade Abdul-Waheed Omar said the policy has forced them to pay surcharges for POS transactions from their meagre wages.

For Omar, some of the alternatives provided by banks and other financial institutions could have been better in Nigeria, especially for petty traders.

The Point Of Sales (POS) Machines and Way Forward for Small Business Owners 

Speaking on applying for Point of Sales machines from her bank, Madam Sabi said she had made several attempts but failed to get one because her business needs to be registered.

Her words:

"I have tried many times but could not get a POS. They (the banks) said I cannot get one because my business is not registered. At some point, they asked me to pay N25,000 to help me with that, I gave them N10,000 to balance N15,000 when the POS is ready, and after months, I am yet to get any.

However, Mama Ejiro, who makes sales from barely selling perishables like avocado pears, mangoes, and other fruits, is not sure she is ready to apply for a POS for her business sticking to her "no cash, no sale" policy.

"What am I selling? These kobo kobo items here? POS is for people doing big businesses,' She added.

Nigerian government can do better for business women

Tope Fasua, a Nigerian economist said the government could do better by cutting the cost of transactions, especially for women who have small businesses.

Listing some non-conventional platforms to send and receive funds, Fasua said payment systems should be improved to accommodate those in the informal tax sector.

Fasua said:

“I am currently in East Africa where I discovered the joy of M-Pesa and how easy it is to make payment.

In fact this is a real example of how payment systems can help, especially small businesses. All you have to do is to transfer money to the person's phone number and they receive it. And the economy keeps moving.”

Also describing the implementation of the Nigerian cashless policy as botched, the economist said it is unfortunate other African nations are doing better than Nigeria in terms of payment systems.

He added:

“It has a lot of effect on women. Women make up most of the informal businesses in Nigeria, they are in the market selling little stuff in every village, in every town in Nigeria.

“They are the ones that also suffered the most at the peak of the roll-out - which was an incomplete roll out of the cashless policy because we were not adequately informed about what the Central Bank of Nigeria intended to do.

“The banks in Nigeria have been struggling to protect the space and in doing that they are not allowing the people (small business owners) to benefit from these innovations.”