Cashless Economy Will Curb Corruption, Money Laundering – CSOs

The recent decision by the Central Bank of Nigeria, CBN, to reintroduce various charges on large cash transactions in deposit money banks has generated mixed reactions by Nigerians, investigations have revealed.
The Coalition of Civil Society Groups, has expressed their support to the recently introduced cashless policy of the Central bank of Nigeria, and has also called for total support of the policy from all Nigerians.
According to the group, this is based on the advantages attached to cashless policy.
The group stated this at the weekend in a press statement jointly signed by the group’s President, Mr Bassey Etuk Williams and Secretary-General, Abubakar Ibrahim and made available to journalists.
The Group said apart from safety concerns, it also guarantees a relaxed atmosphere and confidence of transactions without drawing attention.
According to the statement, “deposit and withdrawal policies deductions to be made over counter payment that is more than Five Hundred Thousand Naira (N5,000,000.00) and Three Million Naira (3, 000, 000.00) for individuals and corporate accounts respectively are aimed at ensuring the effectiveness of the cashless policies of the Federal Government. By so doing it discourages cash deposits at the counter and encourages the use of electronic means that attracts no charges.
“If government must raise revenue, and we think this is one way government can raise revenue to meet its obligation, it calls for the rationale that what we are saying is that it is the right decision that government has taken to increase VAT from 5 to 7.5%.
“Sometimes, we agree that this may be painful, but it is important that we understand that government also has an obligation that it must meet.
“And so, it must raise revenue. Compare the VAT rate in Nigeria to VAT rate in any part of the world. Nigeria’s VAT rate even at 7.5% stands as a one-off if not the lowest in the world.”
The group then appealed to Nigerians “to show understanding. It may seem painful, but again, it is important for us to know that when government spends (because you are looking at the adverse consequences it will have on the purchasing power of the person who will spend), we should also look at the positive implication on the fact that government raises revenue, debt services ratio is lower, government can meet its obligation to improve roads or provide money for electricity; it will also have positive implication on the GDP and average growth of the country.”
The MPC (Monetary Policy Communiqué) noted the government’s current drive to increase Value Added Tax, VAT, will improve fiscal revenue to support expenditure and reduce the budget deficit as well as government borrowing when implemented.
The group completely agrees with the CBN on a cashless economy as “this will make it difficult for corruption and money laundering to thrive. It will also make it difficult for tax evasion, particularly value-added tax, VAT, that is being withheld by those who collect it on behalf of the government.”
Mr Bassey said part of the money realised can be spent on the poor. “We all realise that it is more secure, less costly and much faster as we have completed transactions unlike when it was all about moving huge sums of cash around. We thus, use this medium to call on all well-meaning Nigerians to embrace the policy as a means of encouraging cashless policy needed to drive the economy and same time separate legitimate transactions from questionable ones, which the electronic transfer will reveal over time.”
The group called on the general public to disregard the wrong information being pushed out by those that do shady business that needs to be corrected, as the said charges will only be applicable to daily transactions made over the counter and not per transactions as insinuated.
“A cashless economy will also curb corruption as well as reduce the expenses incurred in printing and transportation of currency notes across the states. It will also make tax payment easy as we know we have a bad record of paying tax as a nation.
“If the policy is implemented, the government will be able to raise significant revenue for government and resuscitate the redundant assets to generate employment and contribute effectively to national economic growth” the statement read.