An Empirical Analysis of the Benefits of Cashless Economy on Nigeria’s Economic Development

Abstract

The Central Bank of Nigeria (CBN) cashless economy policy is of no doubt an essential to the development of Nigeria’s economy. The purpose of this study is to expose the merits of the cashless economy to Nigeria populace, and as well the pains of a cash-based economy. The accidental sampling method was used in the selection of a sample size of 520 persons, out of which 468 persons representing 90 percent of the sampled persons completed and returned the questionnaires administered to them. Collected data were analyzed using the simple percentages method and the hypotheses were tested with the Chi-square and Analysis of variance (ANOVA) tests. The Chi-square test on the first hypothesis reveals a positive and significant relationship between cashless economy and transparency, accountability and reduction cash-related fraud with F-ratio of 70.175> F-critical of 9.488 at 0.05 level of significance with a 4 degree of freedom, while the ANOVA test on the second hypothesis finds that cashless economy has a positive impact on economy development with F-ratio of 51.37> F-critical of 5.32 at 0.05 level of significance with 1 to 8 degree of freedom. The study recommends adherence to minimum security standards and deployment of more ATMs for smooth implementation of the cashless policy in Nigeria.

Keywords: Cash-based economy, Cashless economy, Economic development, E-payment.