Banking and Finance Project Topics

Problems and Prospects of Cashless Economy in a Less Developed Society Such as Nigeria, a Study of Ebonyi State Public Service 2017-2022

Problems and Prospects of Cashless Economy in a Less Developed Society Such as Nigeria, a Study of Ebonyi State Public Service 2017-2022

Problems and Prospects of Cashless Economy in a Less Developed Society Such as Nigeria, a Study of Ebonyi State Public Service 2017-2022


Research Objective

The main objective of this study is to investigate the problems and prospects of a cashless economy in a less developed society such as Nigeria, a study of Ebonyi state public service 2017-2022. Specific objectives include to:

  1. Investigate whether the cashless policy initiative is beneficial to the Ebonyi State Public Service.
  2. Determine whether the adoption of a cashless policy can enhance the growth of financial stability in the Ebonyi State Public Service.
  3. Investigate the impact of the cashless policy initiative on its acceptance level in the Ebonyi State Public Service.



Conceptual Review

Cashless Economy

Contrary to what is suggestive of the term, a cashless economy does not refer to an outright absence of cash transactions in the economic setting but one in which the amount of cash-based transactions is kept to the barest minimum. It is an economic system in which transactions are not done predominantly in exchange for actual cash. It is not also an economic system where goods and services are exchanged for goods and services (the barter system). It is an economic setting in which goods and services are bought and paid for through electronic media. It is defined as “one in which there are assumed to be no transactions frictions that can be reduced through the use of money balances, and that accordingly provide a reason for holding such balances even when they earn rate of return” (Woodford, 2019).

A cashless economy does not mean the total elimination of cash as money will continue to be a means of exchange for goods and services in the foreseeable future. It is a financial environment that minimizes the use of physical cash by providing alternative channels for making payments (Azeez, 2019).

The CBN’s cashless economy programme aims to expand mobile payment options, remove long-standing obstacles to financial inclusion for millions of Nigerians, and offer low-cost, easy financial services to urban, semi-urban, and rural areas nationwide. However, for some elites, the underprivileged, the ignorant, and traders, this has turned into a burden (Andabai & Bina, 2019). The definition of a cashless society by Valentine Obi, Managing Director/CEO of e-Tranzact International Plc, a leading provider of mobile transaction services, is one in which no one uses cash and instead makes all of their purchases using credit cards, charge cards, checks, and direct transfers between accounts. In other words, it alludes to the banking system’s extensive use of computer technology. He claims that over 97% of transactions in the western world today take place without the actual exchange of money, which has significantly reduced costs, corruption, and money laundering. Today, the situation is the opposite in Nigeria, where the bulk of transactions is made with cash. How much money you have in your safe is essentially meaningless in a cashless society. There are many different credit cards and bank transfers you can use to pay for your purchases (Andabai & Bina, 2019). E-finance, e-money, e-brokering, and e-exchange all improve some aspects of how the cashless economy operates. These all speak to how payments and transactions are impacted by a cashless society (Ashike, 2021).

The objective of the cashless economy concept in Nigeria is to minimise cash transactions. For individuals, the CBN has imposed daily cumulative withdrawal and deposit restrictions of N150,000, and for corporations, N1,000,000 (now reviewed to N500,000 and N3 million respectively). Per an additional N1000, penalty fines of N100 and N200 will be imposed (now lowered to 3% and 5%, respectively) (Ezumba, 2021). It should be mentioned that some types of cashless transactions are already occurring in Nigeria as of right now.  The following electronic payment methods are currently available in Nigeria: automated teller machines (ATM), point of sale (POS) terminals, mobile voice, web, inter-bank branches, and kiosks. Local businesses in Nigeria have started e-payment initiatives, which have been encouraged by advancements in technology and infrastructure (Babalola, 2018).




Research Design

The research design is the general plan selected to integrate the several study components logically and coherently.  It serves as a guide for data collecting, measurement, and analysis (Kamangar & Islami,2017). A descriptive survey research design will be adopted for this study. In other words, information will be collected from a host of respondents. This will be done to analyse the qualitative and quantitative information that will be obtained.

Population of the Study

This is the summation of the characteristics that are of interest in a statistical investigation. It comprises every unit that can be used to apply research findings. In other words, a population is a grouping of all the units that have the variable attribute that is the subject of the study and for which general conclusions can be drawn(Shukla, 2020). A target population size of 182 respondents who are customers and staff of commercial banks were surveyed in this study.



Data Presentation



Summary of Findings

According to the findings of this study, 88% of the administered questionnaires were completed and returned, whereas 12% were either not completed or not returned. This analysis shows that a sizable portion of the administered research instrument was returned with all of the required fields filled in. This demonstrates that the majority of the distributed questionnaires were completed by the study’s participants. The empirical evaluation made in this study revealed the breakdown of respondents by age, 69.3% of respondents were men and 30.7% were women. This distribution demonstrates that men made up a sizable portion of the study’s respondents. According to this data, men respondents were more interested in this study than female respondents.

According to the respondents’ age distribution, which is depicted in Table 4.3, 20.5% were between the ages of 20 and 29 years, 61.4% were between the ages of 30-39 years, 9.1% were between the ages of 40 and 49 years, and 9.1% were age 50 or more. According to this data, the majority of the study’s respondents were between the ages of 30 and 39. As a result, a sizable portion of the respondents in this study were adults who were mature and had a greater comprehension of the study’s topic. According to based on the analysis made on the distribution of respondents’ highest degrees, 21.6% of respondents had an OND or NCE, 54.5% had an HND or B.Sc., 14.8% had an M.Sc. or MBA, and 9.1% had other degrees. This study reveals that a significant portion of the research subjects held HND or B.SC degrees. This research shows that graduates of higher schools who are well-educated about the topic of this study filled out the majority of the questionnaires that were provided.


Based on the empirical and statistical analysis conducted for this study, it was determined that the cashless policy initiative had a sizable positive impact on the Ebonyi State Public Service. This study also showed that the development of financial stability in the Ebonyi State Public Service was greatly boosted by the introduction of a cashless policy. Therefore, this research project showed that the cashless policy initiative’s level of adoption in the Ebonyi State Public Service is significantly impacted.


The following recommendations were made in this study:

  1. Since the cashless system will affect everyone, it is necessary to step up the public education campaign about it so that everyone is aware of it before it is implemented.
  2. The government should create special enlightenment programmes for non-literates, employing possibly signs and symbols to educate this section on how to use the cashless system, given the high percentage of illiteracy and the need to include everyone in the system.
  3. Nigeria should work diligently to create an internet security framework to prevent online fraud so that the public can be ensured and safeguarded from cyberattacks and fraud.
  4. To avoid unneeded friction in the system, a thorough analysis of the system is required to identify the number of POS terminals that would ensure its smooth operation in Nigeria.
  5. To fully protect both the system’s operators and the general public, there should be adequate regulation covering every aspect of the operation of the cashless system.


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