<b>Cashless Policy, Transaction Costs, Public Perception, and Financial Inclusion in Adamawa State, Nigeria</b>

This study investigates the effects of the cashless policy on bank customers in Adamawa State, Nigeria, utilizing a sample of 356 bank staff and customers employing Structural Equation Modeling (SEM) for data analysis. The study aimed to understand how the implementation of cashless policies directly influences transaction costs, customer perception of the policy and financial inclusion within the State. Prior to analyzing structural relationships, the study assessed the data's distributional properties, finding visual evidence of approximate normality through histograms and confirming the assumption of homoscedasticity through the random scattering of residuals in probability and scatter plots. The validity of the measurement models was strongly supported by high factor loadings (all above 0.60), indicating that the observed variables reliably represent their intended latent constructs. The core findings from the structural model analysis revealed significant direct effects of the cashless policy. Specifically, the cashless policy was found to have a statistically significant negative effect on transaction costs (-.617), p < 0.001), suggesting that cashless initiatives effectively reduce the costs associated with financial transactions. Furthermore, a statistically significant positive effect was observed on the perception of the cashless policy (.508), p < 0.001), indicating that increased cashless policy prevalence is associated with a more favorable public attitude. Most notably, the cashless policy demonstrated a strong and statistically significant positive effect on financial inclusion (.734), p < 0.001), highlighting its substantial role in expanding access to formal financial services. These results provide compelling empirical support for the hypothesized benefits of the cashless policy, demonstrating its capacity to reduce costs, enhance public acceptance, and significantly drive financial inclusion among bank customers in Adamawa State. The study's findings contribute valuable insights for policymakers and financial institutions aiming to optimize the implementation and impact of cashless initiatives.