Cashless-policy is not new; it started in Nigeria in 2012 with charges for deposits and withdrawals above given thresholds. Since the policy was introduced in 2011 and became operational in 2012, I have been an “interested party” playing from the side lines. My interest was and is due to two factors: my banking and change-management and my self-imposed responsibility to mind other peoples’ business.
Since 2011, I have written about 6 general articles on cashlessness and two published academic papers. The first one was and probably the first empirical work on the policy was based on a study conducted three months after the commencement of the programme (Ik Muo et al 2013); “Managing social change: The case of CBNs cashless policy. Journal of Applied Finance and Banking; 3(2) 75-87). The second one was published in June this year, 3 months after the CBN governor declared that the policy was on its way back and three months before the recent cashless big-bang (Ik Muo 2019 “Strategic options for Nigeria’s cashless policy. Journal of Research in National development; 17(1).
I have shared the contents of some of my general commentaries on this policy in the past two weeks. I want to share the contents of my intellectual work on this policy as stated above before giving my verdict. But before I do so, a word on KITA an acronym for “Kick in the ass,” was introduced into managerial lexicon by Hertzberg when he propounded his two-factor theory of motivation. It is the process of using threats of punishment to coerce somebody into doing something. It is coercion because while force can compel somebody to do something, it can never motivate!
The first paper (2013) reviewed the cashless policy and assessed peoples’ behaviours and attitudes towards it in Lagos where it first became operational. It was found that 72 percentage of the respondents believed that the cashless policy was necessary; only 40 percentage believed that the CBN approach to its implementation was the best but only 36 percentage believed that the policy would succeed. The 64 percentage who believed that the policy would fail justified their doomful predictions on the power supply situation, poor implementation and non-availability of cashless channels in the rural areas.
You cannot force people to change unless you want them to pretend to have changed. My argument since 2011 is that Nigerians should be encouraged (not forced) to embrace the cashless policy through persuasive communication and incentives
A disturbing feature of this policy since its inception has been the several reversals, which indicated that the CBN did not do its homework well or is not surefooted about it. The date for its take-off, the pilot states, the cash thresholds and punishments have all be fiddled with. In effect, it has been one step forward, two steps backwards, three steps inside the bush and back to square one! The latest and most disturbing of these amoebic developments occurred in February 2017. The CBN had reviewed the policy, revised its charges upwards and directed that these should become operational in the pilot states on 1/4/17 and staggered its nationwide implementation from 1/5/19 to 1/10/19.
Surprisingly on 20/4/19, it reversed itself on the new charges and on the nationwide roll-out and reverted its implementation to the pilot states
My recent intellectual intervention, which was based on the postulations of Seth & Fraiser (1982) and Christensen, Marx and Stevenson (1986) concluded that inducement and leadership tools are the most optimal strategies for the effectiveness of the cashless policy. Inducement (persuasion and economic incentives) becomes the preferred strategy when people have positive attitude towards the desired change but do not or cannot change.
Leadership tools (negotiation and salesmanship) are preferred when people agree on what they want but disagree on how to go about it. Nigerians are not opposed to the cashless policy per se; they are opposed to the knee-jerk, KITA approach!
My verdict then is simple and emphatic: “AWAY WITH KITA.” You cannot force people to change unless you want them to pretend to have changed. My argument since 2011 is that Nigerians should be encouraged (not forced) to embrace the cashless policy through persuasive communication and incentives. Customers should be paid to go cashless and this payment can be done through CBNs regulatory intervention or from the cashless-induced savings by the banks. Furthermore, communication should focus on the benefits of the policy, not on the punishment for contravention. When you see the crowds at our ATM machines all over the country, including Lagos, it becomes obvious that the banks should up the ante.
So, no to punishment-based strategy, which is what KITA is all about. I also believe that it is wrong to punish people for depositing their money in the banks. Transporters, fuel-stations, supermarkets and traders in general will surely find this very herculean.
The other day, a woman nearly went berserk at a bank where she was charged almost N40,000 because a customer had lodged cash into her account! I don’t know whether she made up to N40,000 from that transaction. Let people pay in the cash and then hold them by the jugular when they want to withdraw the money by insisting on cashless withdrawal. Of course, the government should walk the talk. Just the other day, Our Vice President was openly sharing cash to traders in the name of “trader money” And then, how did Lagos state give the N20,000 to the South African returnees?
In the next 10 years, we shall review the situation and I can bet as sure as day follows night that if the CBN does not change this approach, we should be where we are today.
Other matters: Governance, a huge joke in Nigeria.
Governance is all about ensuring that those “in charge” promote and protect the interest of the stakeholders. For a government, the number one stakeholder is the citizen, for whose security and welfare, the government exists. All over the world, governance is a serious affair but in Nigeria, it is a huge joke and here are my evidences related thereto.
Sometimes this year, my town-union, which has a hall somewhere in Lagos, joined with other stakeholders in their neighbourhood and requested the local government to do something about their road. A part of the road was constructed sometimes ago and was done in such a way that it gave room to several interpretations and misinterpretations.
About half a kilometre to the hall and two other community halls, the straight road veered off its normal course, and in effect became L shaped. It appeared as if there was a deliberate effort to deny those down the road, including these community halls, the dividends of the tarred road. Well the LG declared that it had no money and that the communities should either pay the LG to do the road (yes, you heard right), or ask for permission to do it themselves. The LG also gave its own quotation for the job. (So, The LG is now a building contractor!).
The concerned stakeholders, compared notes and found that other contractors could do the job at 50 percentage of the LG’s bill and thus wrote to the LG for the authority to adopt the DIY (do it yourself) model. The day this was discussed at the meeting, (28/7/19), there was also a report that the union had paid the current parking and entertainment fees to the LG, which was and is where our responsibilities actually ended. We met again on 29/9/19 and this was the feedback on the matter: The LG had not yet given the approval! So, the LG collects all dues and levies from its stakeholders, fails to do the community road, offers to be the contractor for the same road and refuses to approve a DIY option for the affected stakeholders. That is governance in practice at the LG level; head or tail you lose!
A week after that our July meeting (6/8/19) the Delta state government, through its commissioner for “talk-talk”, Charles Aniagwu, warned residents living in flood-prone areas to urgently “relocate to safer areas so as to avoid any form of calamities.” So, the government could do was just to tell the people (as if they did not know) to relocate! How, to where and with what are they going to relocate? The government was not and is not concerned! The government forgot that if the lizard had a choice, it could not have been going about naked.
The same applies to the basket hung above the fire and the bat that only flies at night; they have no choice. The people know that the place is flood-prone; they know that they ought to move but there is no wherewithal! In effect, what the government has done was to remind them of their helpless wretchedness! That is governance at the state level.
At the federal level, we are all witnesses at how Nigeria managed the recent Naijaphobia in South Africa. It was not xenophobia; at worst, it was Blackophobia. There were no plans for evacuation and no plans for resettlement and reintegration. The government abdicated its first-line responsibilities, which were mercifully undertaken by Air Peace and outsourced the second-line responsibilities to state governments. Malawi on the other hand hired two long buses to evacuate its citizens and provided them with temporary shelters before they left for their various destinations. They hired ordinary busses, but they did something definite. This is governance at the federal level.
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