Cashless Policy and the Nigerian Economy: A Disaggregated Approach

Over the years, the Central Bank of Nigeria (CBN) has engaged in series of reforms aimed at making the Nigerian payment system formidable.These reforms were meant to enhance the overall economic performance of Nigeria so as to place it on the right path and in tune with global trends.Since Nigeria's independence in 1960, successive reforms such as the change in economic and banking policies mainly targeted at stabilizing the economy have been channeled at enhancing social welfare and achieving other economic developmental goals.The introduction of mobile banking, electronic banking and online transactions (cashless policy) in Nigeria has paved way for a new era of development where the use and demand for physical cash is gradually declining.The increase in emerging Information Technology (IT), has made banking services become more and more automated and less paper work than in the past as averred in the Central Bank of Nigeria (CBN) reports.Banks in Nigeria have realized that they would soon go out of corporate existence unless they keep with the pace at which Information Technology (IT) has redefined the creation of value and worth for their customers (Austin, 2016).The recent evolution of information technology in the Nigerian financial institutions posses interesting questions regarding the current economic status, logistics, and availability of instruments to guarantee economic growth and stability in the era of cashless policy.The cashless policy was aimed at curbing some of the negative consequences associated with the usage of physical cash in the economy, including high cost of cash, high risk of using cash, high subsidy, armed robbery, inefficiency as well as corruption (CBN, 2011).Some analysts (Austin,