Central Bank of Indecisiveness

By Amina Adamu Kollere

Some months ago, the news was dominated by discussions about the CBN Governor Sanusi Lamido Sanusi (SLS), and his attempt to introduce N5000 notes into the Nigerian economy. This spurred huge debates all over the country which resulted in SLS openly attacking the former President of Nigeria, Olusegun Obasanjo.

I have no fond love for Obasanjo, but I do think that SLS was inappropriate, rude, and unprofessional. The headline read ‘Obasanjo is a bad economist’, and SLS was reported to have said, “This is an interesting country because my uncle or my father, who is our former Head of State, Gen. Obasanjo, you know he is a very successful farmer, but he is a very bad economist. He stands up and says that this higher denomination (N5000 note) will cause inflation and improve hardship.” Pardon me Governor, but there are better ways to disagree with Obasanjo, and they wouldn’t make you sound like an angry okada man.

That being said, the issue I want to put on the table is the indecisiveness of The Central Bank of Nigeria. Not long after CBN started contemplating having a cashless economy, it started contemplating the introduction of coins and the N5000 note. Don’t you all think that is a tad contradictory? I certainly think that SLS should make up his mind before making his thoughts public.

Rumors started that producing the N5000 note would cost Nigeria N40 billion, but SLS negated it saying that it would actually save Nigeria N7 billion. Did he provide facts to support his claim? Not that I know of.

The Country Manager of MasterCard, West Africa, Omokehinde Ojomuyide, said, “MasterCard envisions a world beyond cash, a goal that mirrors the cashless policy conceptualized by the Central Bank of Nigeria. We support this policy that aims to modernize the country’s payment systems. One of the key elements is reducing the cost of banking services and the cost of cash, as well as growing financial inclusion by providing more efficient transaction options and greater reach.” Continuing, she said: “It also aims to curb the high cost of using and accepting cash as a payment method, and prevent corruption, leakage, money laundering and other fraudulent activities that cash can enable.”

Howevr“However, to introduce a cashless policy means limiting individuals of cash withdrawal or lodgment in banks to N150, 000 and then initiate changes in features of all currencies in circulation while introducing a new N5000 note, means a deadline will be given within which hoarders of cash outside the banking system have to trade their old currencies for the new ones, which they can only do through banks and the cashless policy will be waiting for them”, wrote Kingsley Omose of Vanguard.

The fraudsters and politicians hoarding stolen cash must hate SLS for trying to put them in a difficult position. I hope that someday Nigeria becomes cashless just to put a dent in our Polithieves armors. However, for that to happen, thousands of illiterates in the country would have to be educated, which would not happen any time soon.

I appeal to SLS to not complicate matters. If he thinks we should become cashless, then he should put all his effort into seeing that it is successful instead of increasing our denominations at the same time. If he thinks the N5000 note is good for the country, then, again, he should try to make it work. This is not a context where we attempt to kill two birds with one stone. In this case, the stone will just scare the birds away. I may not know much about economics, but I do know that if SLS doesn’t make up his mind, come 2013, our economy would be even more unstable than it is now.