Pay­ing more than nec­es­sary

The Punch - - EDITORIAL - Ade­wale Kupoluyi, Fed­eral Univer­sity of Agri­cul­ture, Abeokuta ade­walekupoluyi@ya­

WHAT has grad­u­ally be­come a norm in our coun­try to­day is the re­luc­tance to give ‘change’ by sell­ers “to buy­ers of goods and ser­vices. It is an em­bar­rass­ing sit­u­a­tion that peo­ple have found them­selves in al­most on a daily ba­sis. When a buyer pur­chases an item with a higher money de­nom­i­na­tion in an­tic­i­pa­tion of col­lect­ing ‘change’, what hap­pens at the end of the day is that such money ends up in the pock­ets of sell­ers of the items. This prob­lem, which I think is more of so­cial or at­ti­tu­di­nal, rather than eco­nomic or fi­nan­cial, has been with us for many years. The only dif­fer­ence now is that, it has as­sumed a mag­ni­tude that needs to be re­versed, as much as pos­si­ble.

Ev­ery­one is guilty; the mar­ket women, do­mes­tic ser­vants, taxi driv­ers, recharge card sell­ers, food ven­dors and so on.

De­nom­i­na­tions of N1, 50k, 25k, 10k and 1kobo were is­sued by the Cen­tral Bank of Nige­ria in the 1990s, but the ill-fated Struc­tural Ad­just­ment Pro­gramme led to their ex­tinc­tion, as higher note de­nom­i­na­tions of N5, N10, N20, N50, were adopted to take care of the tra­di­tional roles as­so­ci­ated with lower de­nom­i­na­tion coins. These notes be­came unattrac­tive and dirty na­tional sym­bols. Cur­rently, Nige­ria’s le­gal ten­ders in­clude 50 kobo, N1 and N2 while note de­nom­i­na­tions are N5, N10, N20, N100, N200, N500 and N1,000. Al­though coins can last over 50 years of ac­tive usage un­like cur­rency notes that de­pre­ci­ate fast, peo­ple still pre­fer to hold and spend cur­rency notes. Why this spend­ing pat­tern? To be­gin with, many Nige­ri­ans dis­like coins be­cause they are cum­ber­some to carry. As a re­sult, the least cur­rency de­nom­i­na­tion nat­u­rally takes the place of the coin with the high­est mon­e­tary value in a coun­try where it is im­pos­si­ble to find a prod­uct that is sold for N1.

Besides, the high in­fla­tion­ary level in the coun­try has ‘pushed’ prices of com­modi­ties to a level that the need for coins is ab­so­lutely min­i­mal. Why carry lots of coins when sin­gle notes can come in handy? An­other fac­tor is the so­cial/com­mu­nity life of the peo­ple that in­volves the use of money at cer­e­monies. Dur­ing these events, hardly do we see peo­ple spend coins. Peo­ple would rather pre­fer to ‘spray’ notes to coins. Over time, peo­ple have be­come al­most com­pletely de­tached from the use of coins as a le­gal ten­der in Nige­ria. Even beg­gars hardly ac­cept coins from any­body, nowa­days. It’s ei­ther you give notes or you keep your money. I’ve heard of beg­gars re­fus­ing to col­lect coins from gen­er­ous givers; they sim­ply tell them to ei­ther give notes or keep their coins.

In the real sense of it, do we re­ally blame these per­sons? It is not only that too many coins be­come heavy bur­den to carry about, the in­ci­dent of too many coins chas­ing few goods is a tru­ism that peo­ple would not want to stress them­selves up un­nec­es­sar­ily. The an­noy­ing thing about this awk­ward de­vel­op­ment is that, if you are the type that be­lieves in do­ing things right, you are likely to in­cur the wrath of other peo­ple. When you give out a high naira de­nom­i­na­tion and ex­pect peo­ple to give you ‘change’, you are sim­ply invit­ing trouble for your­self. What you get are heaps of in­sults, dis­re­spect, scorn and dis­dain. Not only that, the lan­guage and man­ner of the con­ver­sa­tion would be so rude that makes it dis­cour­ag­ing to even ask for ‘change’. What this means is that peo­ple are forced to pay more than nec­es­sary on a daily ba­sis.

Re­cently, the Sen­ate made moves to en­cour­age the con­ver­sion of lower cur­rency notes into coins to fa­cil­i­tate re­tail trans­ac­tions in the coun­try, in a bid to make the use of coins com­pul­sory, as a means of ex­change through cash trans­ac­tions. To achieve this, the Sen­ate asked the CBN to sanc­tion any com­mer­cial bank that re­fuses to col­lect coins from cus­tomers, even as it urged the apex bank to re­design the na­tion’s cur­rency to cater to what it de­scribed as “highly repet­i­tive trans­ac­tions” in the econ­omy. Coins are fast go­ing out of fash­ion and go­ing into ex­tinc­tion be­cause of the face value of the metal that is used in pro­duc­ing it, is lower than its in­trin­sic value be­cause some peo­ple are al­legedly tak­ing those coins to gold­smiths to turn them into jew­ellry and other or­na­ments for sale.

What should in­ter­est those in au­thor­i­ties is how to strengthen the naira and re­duce the high in­fla­tion in the land that could make ba­sic com­modi­ties af­ford­able. More im­por­tantly, we need to change the wrong and em­bar­rass­ing at­ti­tude of not want­ing to give ‘change’ to peo­ple dur­ing fi­nan­cial trans­ac­tions. It should not be en­cour­aged. This at­ti­tu­di­nal change should be­gin with you and me.

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