The biggest enemy in fighting poverty is physical cash. The fact that people living at the bottom end of the pyramid need to conduct their business with paper notes (and coins) is the main reason why they are often stuck there. That is why it is important to apply all means to change this – technology, business solutions and regulations.That is why I found a recent article interesting (Read here). According to this article, the Central bank announced a new cumulative limit to the withdrawal of cash for both individuals and corporations. This leads to the following questions:Knowing Nigeria, and the dependency of the country on cash, I am intrigued how it is possible that this legislation could possibly fly. How is it possible to restrict the supply of cash, when electronic payment infrastructure are limited and cheques are viewed with apprehension.Also, the application of this directive will be difficult. To really ensure that banks adhere to this direction, integration between banks will have to be much tighter. The cost and infrastructure required could surely be spent on other parts of the banking industry.One could argue that, rather than implementing this type of regulation, the industry should rather focus on providing electronic payment capabilities (like mobile banking), at a faster rate. This will be a more effective way to eliminate cash.

Read more: http://mbanking.blogspot.com/2011/05/nigeria-and-cash.html