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At Present, developing and new economy emerging countries have massively engaged in the transition from manual to more computerized modus operandi in government activities, predominantly in the area of public fund management. Most renowned among them is the effort at reviving of the Treasury Single Account (TSA) policy. The effectiveness of the policy commenced through the Federal Government’s directive to all revenue – generating agencies to maintain single accounts with commercial banks.

Treasury Single Account is a public accounting system under which all government revenue, receipts and income are collected into one single account, usually maintained by the country’s Central Bank and all payments done through this account as well. The purpose is primarily to ensure accountability of government revenue, enhance transparency and avoid misapplication of public funds. The maintenance of a Treasury Single Account will help to ensure proper cash management by eliminating idle funds usually left with different commercial banks and in a way enhance reconciliation of revenue collection and payment (Adeolu, 2015).

Section 80 (1) of the 1999  Constitution as amended states “All revenues, or other moneys raised or received by the Federation (not being revenues or other moneys payable under this Constitution or any Act of the National Assembly into any other public fund of the Federation established for a specific purpose) shall be paid into and form one Consolidated Revenue Fund of the Federation. In view of this section, successive governments have continued to operate multiple accounts for the collection and spending of government revenue in flagrant disregard to the provision of the constitution which requires that all government revenues be remitted into a single account. It was not until 2012 that government ran a pilot scheme for a single account using 217 ministries, department and agencies as a test case. The pilot scheme saved Nigeria about N500 billion in frivolous spending. The success of the pilot scheme motivated the government to fully implement TSA, leading to the directives to banks to implement the technology platform that will help accommodate the TSA scheme. The recent directives by the Buhari Administration that all government revenues should be remitted to a Treasury Single Account is in consonance with this programme and in compliance with the provisions of the 1999 constitution (CBN, 2015).

The Central Bank has opened a Consolidated Revenue Account to receive all government revenue and effect payments through this account. This is the Treasury Single Account. All Ministries, Departments and Agencies are expected to remit their revenue collections to this account through the individual commercial banks who act as collection agents. This means that the money deposit banks will continue to maintain revenue collection accounts for Ministries, Departments and Agencies but all monies collected by these banks will have to be remitted to the Consolidated Revenue Accounts with the CBN at the end of each banking day. In other words, Ministries, Departments and Agencies accounts with money deposit banks must be zerorized at the end every banking day by a complete remittance to the Treasury Single Account of all revenues collected. The implication is that banks will no longer have access to the float provided by the accounts they maintained for the Ministries, Departments and Agencies. Difference types of account could be maintained under a Treasury Single Account arrangement and these may include the TSA main account, subsidiary or sub-accounts, transaction accounts and zero balance account. Other types of accounts that could operated include imprest accounts, transit accounts and correspondence accounts. These accounts are maintained for transaction purposes for funds flowing in and out of the Treasury Single Account (Adeolu, 2015).

From the foregoing, it is obvious that the primary benefit of a Treasury Single Account is the mechanism it provides for proper monitoring of government receipts and expenditure. In Nigeria, it will help to block most if not all the leakages that have been the bane of the growth of the economy. The maintenance of a single account for government will enable the Ministry of Finance monitor fund flow as no agency of government is allowed to maintain any operational bank account outside the oversight of the ministry of finance.

As a matter of fact, deposit money banks stand to lose immensely from the implementation of Treasury Single Account.  This is because of the fact that public sector funds constitute a large chunk of commercial banks deposit.  Indeed, it is estimated that commercial banks hold about N2.2 trillion public sector funds at the beginning of sector quarter of 2015.  The impact of this amount of money leaving the system can be imagined when one considers the fact that each time the monthly federal allocation is released, the banking system is usually washed with liquidity and as soon as this public sector funds dries up through withdrawal by the states, liquidity tightens again with interbank rates going up.  In view of this background, the study investigates the implication of Treasury Single Account on Banking Sector.


As the Federal government of Nigeria introduces Treasury Single Account, Banks will continue to device means of mobilizing funds from the private sector.  We see a return of the era when women are employed by banks specifically for deposit mobilization and tacitly encouraged to use any means necessary to get funds.  We see increase in deposit interest rates as a major means of inducing customers and most importantly we see a drop in lending and in the profitability of banks, at least, in the short to medium term until they fully come to terms with the impact of the policy and begin to properly position themselves for true banking business.  Ultimately, we see the share price of these banks falling as investors attempt to price in the policy impact. However, the implementation of this programme is a critical step towards curbing corruption in public finance. This is a tool to combat corrupt practices, eliminate indiscipline in public finance and ensure adequate fund flow that will be channelled to critical sectors of the economy to catalyse development.

Treasury Single Account has really become a problem, because it cannot really account for the various changes in the agenda as these agendas experience rapid discontinuous changes when there are crises or even during election. As a matter of fact it becomes a problem when new technology emerges.

Most of the money realized from revenue are being paid into multiple accounts that being operated by MDAs in Commercial banks obtained under the old constitution which is going against the new Nigerian Constitution.


The broad objective of this study is to assess the implication of Treasury Single Account on Banking Sector: other specific objectives are

  • To examine the effect of Treasury Single Account on the performance of banking sector in Nigeria.
  • To find out the relationship that exists between the implementation of Treasury Single Account and banking service delivery in Nigeria.
  • To determine the extent to which Treasury Single Account can block financial leakages, promote transparency and accountability in the banking Sector.



  • Does Treasury Single Account have any effect on the performance of banking sector in Nigeria?
  • Is there any relationship between the implementation of Treasury Single Account and the performance of banking service delivery in Nigeria?
  • To what extent to can TSA block financial leakages, promote transparency and accountability in the banking Sector.

1.5 Research Hypotheses

H01Treasury Single Account has a significant effect on the performance of banking sector in Nigeria

H02: The implementation ofTreasury Single Account has a negative relationship with the performance of banking service delivery in Nigeria

H03: Treasury Single Account can significantly block financial leakages, promote transparency and accountability in the banking Sector


This study is of significant to many stakeholders especially the management, employee, government, researcher and entire public

Firstly, the results from this study will educate the general public on the benefits of Treasury Single Account to the economy of the country. It will also ensure them to know the concept and the operation of Treasury Single Account in the country.

Secondly, it will also educate on both the management and the employee within the banking sector so as for them to examine the effect of TSA on banks and how to face the challenges.

Finally, this research will also serve as a resource base to other scholars and researchers interested in carrying out further research in this field subsequently, if applied will go to an extent to provide new explanation to the topic.



This research work shields the implication of Treasury Single Account on the banking sectorfrom 2012 to 2016.  The researcher cannot conduct the study on the all banks in Nigeria. Hence, some selected Banks (First Bank, Ecobank, GTBank and Zenith located in Kaduna Metropolis were used and the result will be used to generalize. The researcher observed issues likes: continue poor banking service and high level of staff downsizing in the banking industry, which prompted him to conduct this study.


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