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Lagos — Cashless policy will enhance national payments system and address currency management hitches in the country, governor of the Central Bank of Nigeria (CBN) Governor, Sanusi Lamido Sanusi, has said.
Speaking at the fourth memorial lecture of the Clement Isong held in Lagos at the weekend, Sanusi explained that the economy is heavily cash-oriented, a trend that increases the operational costs of the banking sector.
He said the costs are passed down to the customers in the form of high service charges and high lending rates.
Sanusi who was represented by CBN Deputy Governor, Corporate Services, Suleiman Barau said the operational costs were wholly due to the high cost accrued in cash management, currency sorting, cash movements and frequent printing of currency notes.
He said the direct cost of cash management to the banking industry was estimated to be N192 billion by 2012.
"Research has shown that about 90 per cent of bank customer daily withdrawals are of amounts below N150, 000 whereas, only 10 per cent of bank customers who withdraw over N150,000 are responsible for the rise in cost of cash management being incurred by all the bank customers," he said.
The retail cash policy, which started on April 1, 2012, in Lagos, as a pilot project, stipulates that over the counter cash transactions above N500,000 and N3,000,000 for individuals and corporate, respectively will attract a charge. The implementation is expected to continue in other regions across the country with effect from January 1, 2013.
The CBN has also set up a Consumer Protection Department to address user's complaints concerning issues relating to the banking and payment channels. The banks will also be adopting biometric authentication for PoS and ATMs to address safety of customer's funds and avoid losses through compromise of the Personal Identification Number (PIN).