The Federal Executive Council (FEC) yesterday approved the Central Bank of Nigeria’s (CBN’s) cashless economy proposal, seeking to use Lagos to test run the policy.
The FEC added that the policy would help reduce cost of running banks by 30 per cent.
The development came just as Governor of Central Bank of Nigeria (CBN), Malam Sanusi Lamido Sanusi, said Nigeria’s economy had grown at the rate of 6.4 per cent in the first two quarter of 2011 against the overall growth projection of 7.8 per cent for this year.
He however said that inflationary pressures still pose serious challenges to the economy.
Sanusi said this in a report which he presented before the FEC.
Briefing State House Correspondents, the Minister of Information, Labaran Maku, said the CBN boss tendered the said report before the FEC meeting presided over by President Goodluck Jonathan on the performance of the second quarter of the nation’s economy at the Council Chamber of State House, Abuja.
Maku said, “CBN has decided to start the cashless economy in Lagos, using Lagos as the hub and has taken in partnership with the Governor of Lagos State, Mr. Babatunde Fashola (SAN) and in few months to come Lagos will move swiftly into e-banking and there is also the initiative to introduce mobile banking across the country so that with our telecoms we can use them to open our bank account, transfer money, receive payment or withdrawals.”
On the economy, Maku said Sanusi identified high lending interest rates, low credit flows to the core private sector and sustained pressure in the foreign exchange as some of the variable crippling the speedy growth of the economy.
He also identified low accreditation to reserves, fluctuating interbank interest, huge fiscal injections and continued stagnation of the manufactring sector as other lingering challenges facing the economy.
But Maku said despite these challenges, the report indicated that inflation had decelerated to 10.2 per cent in the second quarter from 12.8 per cent in the first quarter of 2011 while core inflation fell from 12.8 per cent in the first quarter of 2011 to 11.5 per cent in June.
Sanusi further told the FEC that food inflation declined sharply from 12.2 per cent in May, to 9.2 per cent in June 2011, while oil sector growth at 2.90 per cent and 3.4 per cent, respectively.
Maku said the report also indicated that oil production has gone up to 2.4 million barrels a day and attributed the rise to the return of peace to the Niger Delta through the amnesty programme.
Maku also hinted that FEC gave approval to Federal Ministry of Education to forward an Executive Bill to the National Assembly for an Act for the amendment of Education National Minimum Standard and Establishment of Institution Act and other Related Matters.
The Bill if passed in to law, Maku added, will empower the National University Commission to handle cases of proliferation of illegal Universities and prescribe punishment for those who violate minimum quality standard for the establishment of Universities and Courses.
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