Can Africa operate a cashless policy?

cashless policy - cfamedia

A cashless society is an economy, where financial transactions, are not done with physical currency, such as banknotes, but through an electronic representation of money.

Before the advent of currency, trade by barter and other means of exchange were the means of conducting financial transactions in the polity.

Money became a better means of exchange, to measure value for goods and services in the economy, but as technology evolved, cash was replaced with its digital equivalent, which enables exchange in electronic digital form.

Illiteracy has, always, been one of Africa’s challenges and this may prove to be the cog in the wheel, in the upgrade of the financial economy of the continent.

The enlightenment of the operations of cashless policy should be paramount, before effectively pushing the operation of one.

Due to these limitations, a number of Africans, do not trust cashless transactions.

A purchase made, with one ignorant of the operations of how cashless transactions run, will view it as a scam and such person would not trust the operations.

A local market woman, who sells local goods may not understand the rationale behind a customer, taking her goods and opting to transfer the cash; it is often seen as a form of scam, due to ignorance.

Countries, all over the world, are working towards evicting the use of cash and embracing the cashless society, because of the huge benefits attached to it.

While countries, like Germany and New Zealand, have introduced a cashless policy, to a large extent, many countries in Africa, are, also, working towards joining the bandwagon.

This has come, as a surprise to many financial experts, as they expected a major resistance from African countries.

Nigeria, as a country is not left out as well.

Despite the limited ATMs and banks, banks strive to solve this problem by introducing systems and applications; over a million active users are recorded, as using digital platforms from the first Nigerian digital payment platform, Paga.Mobile.

Applications are introduced by banks, to enable people to pay bills and transfer money digitally; this makes it easier for the customer to perform transactions, without going to the bank.

In different African countries, banks are beginning to push people to patronised the use of credit cards and not traditional cash transactions.

This change is limited to mainly the literate population, due to a lack of knowledge about the use of credit cards and having a large population, with no access to banks.

In Africa, the growth in the use of mobile phones is now credited, for its success. Mobile connections have doubled, in the last two years, rounding off to a number of about 226 million.

This proves Africa’s growth and gradual move, towards a cashless society. It may take a while but Africa will surely get there.

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