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CBN increases cash withdrawal limit to ₦500K weekly for individuals

The Central Bank of Nigeria has revised weekly cash withdrawal limits to ₦500, 000, ₦5 million for individuals, corporates

CBN increases cash withdrawal limit to ₦500K weekly for individuals
Godwin Emefiele, CBN Governor and the soon-to-be invalid Naira notes.

Barely two weeks after the Central Bank of Nigeria (CBN) directed financial institutions to ensure that weekly cash withdrawals by individuals and corporate entities do not exceed ₦100,000 and ₦500,000, respectively, the bank has amended its decision.

Starting January 9, 2023, the maximum weekly limit for cash withdrawals across all channels by individuals and corporate organisations to ₦500,000 and ₦5 million, respectively.

According to the CBN Director, Banking Supervision Department, Haruna Mustafa, the amendment is "based on feedback from stakeholders".

"The CBN recognises the vital role that cash plays in supporting underserved and rural communities and will ensure an inclusive approach as it implements the transition to a more cash-less society. All banks and OFIs are to note that aiding and abetting the circumvention of this policy will attract severe sanctions," Haruna added.

The initial withdrawal limit met disapproval from citizens, businesses and the National Assembly. Many agency bankers had said the policy would strangulate their activities and rob them of employment—however, Haruna on Saturday (Dec. 17, 2023) said that "not in any way are they (PoS agents) endangered".

In a statement on Dec. 6, 2023, the CBN stated that the policy on revised cash withdrawal limits is in line with its cashless policy. Ultimately, the plan is to encourage more Nigerians to use alternative channels to carry out their banking transactions. Examples of such alternative channels are mobile banking, USSD, debit cards, POS, eNaira.

The policy is also part of the apex bank’s plans to protect the newly redesigned banknotes and guard against their misuse, counterfeiting and hoarding. The money supply in the Nigerian economy jumped to an all-time high of ₦49 trillion in August, experts say that excess money supply in the economy encourages inflation.

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For instance, Nigeria's inflation rate soared to 21.09% in October 2022. The CBN responded to that by increasing the benchmark interest rate (MPR) by 100 basis points to 16.5% during its last Monetary Policy Committee (MPC) meeting for the year

For withdrawals above  ₦500K and ₦5 million

Following the latest review, the CBN has made provisions for individuals and corporate organisations to withdraw above the specified limits under special circumstances. However, any request to exceed the withdrawal limits "shall be subject to a processing fee of 3% and 5% for individuals and corporate organizations, respectively".

Customers will be required to provide the following documents for vetting and approval by the CBN:

  • Valid means of identification of the payee (National ID, International Passport, or Driver’s License).
  • Bank Verification Number (BVN) of the payee.
  • Tax Identification Number (TIN) of both the payee and the payer.
  • Approval in writing by the MD/CEO of the financial institution authorising the withdrawal.

Meanwhile, the CBN said cheques above ₦100, 000 will not be eligible for over-the-counter withdrawal. Also, the extant limit of ₦10 million on clearing cheques will subsist.