The increasing adoption of electronic payment systems has transformed the way business transactions are conducted in Nigeria. The Central Bank of Nigeria (CBN) introduced the cashless policy as part of efforts to reduce excessive dependence on physical cash, modernise the national payment system, improve financial inclusion, enhance transaction efficiency and reduce the risks and costs associated with cash handling. Small and Medium Enterprises (SMEs), which constitute an important component of local economic activity, are particularly affected by the transition from cash-based transactions to electronic payment systems. This study examines the impact of the cashless policy on SMEs in Tudun Wada and Doguwa Local Government Areas of Kano State. The study focuses on the extent of adoption of electronic payment channels, including Point-of-Sale (POS), mobile banking, internet banking and electronic funds transfer, and examines their effects on transaction efficiency, sales, profitability, customer satisfaction and business growth. A quantitative survey research design is proposed, using structured questionnaires administered to owners and managers of selected SMEs in the two Local Government Areas. Descriptive statistics and inferential techniques, including correlation and multiple regression or Partial Least Squares Structural Equation Modelling (PLS-SEM), are appropriate for testing the relationship between cashless-policy adoption and SME performance. The literature indicates that electronic payment channels can improve transaction speed, convenience, transparency and operational efficiency, although challenges such as network failure, electronic fraud, transaction charges, unreliable electricity supply, inadequate digital literacy and limited access to digital infrastructure may constrain their benefits. The study argues that the effectiveness of the cashless policy among SMEs depends not merely on policy enforcement but also on the reliability, affordability, accessibility and security of electronic payment infrastructure. The study recommends improved telecommunications and electricity infrastructure, affordable transaction charges, stronger consumer protection and cybersecurity measures, continuous digital-financial literacy programmes, and targeted support for SMEs in semi-urban and rural communities.

Keywords: Cashless Policy, Small and Medium Enterprises, Electronic Payment, POS, Mobile Banking, Financial Performance, Tudun Wada, Doguwa, Kano State.