By Yvonne-Faith Elaigwu
Consider a typical day in the life of Mr. Chukwu, a small business owner in Lagos. His morning ritual invariably starts with a visit to the bank to withdraw the amount of cash to sustain his shop operations for the day or deposit the excess amount of cash from the previous day’s sales. From catering to customers’ change needs to safeguard their earnings from potential theft, the tangible presence of cash, while familiar, also brings with it a unique set of challenges.
Now, imagine a different scenario. A scenario where Mr. Chukwu no longer has to worry about these issues. This is the promise of a cashless society. In such a society, his daily transactions would be seamless, immediate, and secure, freeing up his time and mental bandwidth to focus on what he truly loves – serving his customers and improving his business.
Moreover, a cashless economy can provide businesses like Mr. Chukwu’s with a new kind of asset – data. Every digital transaction tells a story, providing valuable insights into consumer behaviour. Businesses can tap into this data to understand their customers better, tailor their offerings, and make informed, data-driven decisions. This, in turn, can help businesses drive growth and foster customer loyalty. Companies like OnePipe, for instance, are at the forefront of this data revolution, leveraging technology to help businesses unlock the potential of their transaction data.
But the impact of a cashless society extends beyond individual businesses. On a macro level, it promises to usher in significant benefits for the Nigerian economy. Cashless transactions can help formalise the economy, bringing a larger share of transactions under the purview of the banking system and thereby increasing the taxable base. This could lead to an increase in government revenue, enabling more effective fiscal policies and contributing to overall economic growth.
Moreover, a cashless society has the potential to democratise access to financial services. Take the example of Amina, a resident of a remote village in Sokoto. Her interaction with the financial system has always been limited due to her physical distance from banking institutions. But in a cashless economy, all Amina needs is a phone and a bank account. This would allow her to participate in the financial system, providing her with access to credit, the ability to save and invest, and a host of other financial services that were previously out of her reach.
The transition to a cashless society, however, isn’t a walk in the park. It requires a concerted effort from all stakeholders – the government, financial institutions, businesses, and individuals. It requires significant investments in digital infrastructure, consumer education, and robust regulatory frameworks to ensure that the transition is smooth, secure, and inclusive.
Despite these challenges, the potential benefits of a cashless society make the journey not just worthwhile, but necessary. Businesses stand to gain from increased efficiency and access to data. Businesses, like Mr. Chukwu’s and customers like Amina, will enjoy a seamless and inclusive financial experience. And on a larger scale, the Nigerian economy stands to benefit from increased formalisation and financial inclusion.
As we stand on the brink of this transformation, it’s time to embrace the promise of a cashless Nigeria – a future where every transaction is seamless, where businesses are empowered by data, and where every Nigerian, regardless of where they live or what they do, can participate in and benefit from a vibrant and inclusive economy. It’s a bold vision, but with the combined efforts of all stakeholders, it’s a vision that we can make a reality.
Yvonne-Faith Elaigwu is the Head of Operations and Governance, OnePipe