Lagarde: Nigeria could save N3.2trn by switching govt payments from cash to digital

Christine Lagarde, managing director of the International Monetary Fund (IMF), says Nigeria could save as much as $9 billion (N3.24 trillion) by shifting government payments from cash to digital systems.

Speaking in Ethiopia on Friday, Lagarde said 1.7 percent of the country’s gross domestic product (GDP) could be saved via the digitisation of the country’s payment systems.

Lagarde also said she was very excited to meet the head of Andela, a tech company domiciled in Nigeria, and solving problems across the world.

“IMF analysis in our recently published book, Digital Revolutions in Public Finance, shows that across the developing world, countries could save around one percent of GDP by updating their government payment systems from cash to digital,” she said.

“In some places in Africa the potential is even higher. In Nigeria, for example, we estimate that a government move to digital payments could save between 5 to 9 billion U.S. dollars, or about 1.7 percent of GDP.

“When governments put technology into practice millions of people can be helped. Think of Sierra Leone. During the Ebola outbreak, some emergency responders had to leave their patients for days to go and collect payments from a regional office.

“By introducing a mobile wallet system, the government was able to save lives and better allocate resources where they were needed the most.”

She said “the potential to help reduce corruption, increase revenues, and generate investments in health and education means digital tools could be a decisive factor in meeting the 2030 Sustainable Development GoalsThe voice of the IMF will be part of that process”.

Speaking of Andela, she said: “In October at our Annual Meetings, I was excited to meet the head of a company called Andela that considers Africa ‘home to the largest untapped talent pool’ and is training and matching African workers to help U.S. companies fill shortages in tech jobs such as programming.”

“When I travel in Africa, I never worry that the dreams of the next generation are not big enough. They are. The only question is how can we help create the environment where those dreams will have a chance to come true.”