Wednesday, 28 May 2014

Coin Money Extinction

When conservationist talk about animal extinction, I thought, it was only common to animals, but now I know it can happen to anything under the surface of the earth.

In the case of the Nigerian coin money, it is an extinction orchestrated by Nigerians against Nigeria and its economy. This can be seen in the way goods and services are priced--to the nearest whole Naira. Any increases in commodity prices are in whole numbers. And where the prices happen to include some Kobos, consumers are expected to forfeit their change. But what are actually responsible for this seemingly extinction of the Nigerian coin money? Lets look at some culprits:

Central Bank of Nigeria, Commercial Banks and Financial Institutions: 
How true? CBN only makes available currencies--notes and coins-- and authorizes their usage by Nigerian consumers within the economy. The commercial banks and other financial institutions are expected to distribute the currencies, both notes and coins, to the public. If the role of the apex bank, the commercial banks and financial institutions is to make these currencies available to the Nigerian public, why then should they be blamed for the seemingly extinction of the Nigerian coin money? In my own opinion, I owe them culpable because they failed to educate the people on the importance of coin money and their roles in price stability. Commodities are priced above their worth because the price system permits it. You cannot buy any products less than a Naira even if the worth of the products is in kobo.

User Apathy:
When I hear this view from the public, I really wonder which group is responsible. Could it be the consumer group or goods/service group or both? The attitude of the consumer group towards the use of coin money is influenced largely by the goods/service group, simply known as the retailers/service providers. Nigerian retailers/service providers do not encourage the use of coin money as indicated in their price system. The Nigerian price system is bias against the use of coin money.

Nigerian consumers also consider the burden of carrying of the coin money to be responsible for their refusal to use them. They complain of the damage coin money can do to their pockets if carried for a long time.

Are these good reasons to allow the total extinction of the Nigerian coin money? I don't think. It is our duty to protect our coin money from extinction, at least, for the sake of our future generation.

The apex bank and its affiliates should intensify efforts in making sure the coin money is available at all times. Bank halls should carry posters containing information on the importance of coin money and their roles in price stability. Educational campaigns should be held in all public places and institutions to encourage acceptance and use of the coin money.

Coin monies are not meant to be carried in bulk, so Nigerians shouldn't complain of their effects on their pockets. And where there is a deliberate effort by any group to discourage the use of coin money in the country, such group should be sanctioned.

We must save Nigerian coin money. And now is the time.