CBN Raises Cash Withdrawal Limit

·       Maximum weekly withdrawal now N500,000 for individuals, N5m for corporate entities

·       Reiterates drive for a cashless economy, new policy begins January 9, 2023

James Emejo in Abuja

The Central Bank of Nigeria (CBN) Wednesday announced an upward review of its cash withdrawal policy across all payment channels by individuals and corporate organisations.

Under the updated regime, the bank said effective January 9, 2023, individuals and corporate entities can withdraw a maximum of N500,000 and N5 million respectively compared to N100,000 and N500,000 which was previously announced on December 6, 2022.

However, the central bank, in an updated circular dated December 21, 2022, and addressed to all Deposit Money Banks (DMBs) and Other Financial Institutions, Microfinance Banks, Mobile Money Operators, and Agents, explained that the upward review was, as a result of the feedback it received from stakeholders.

The correspondence was signed by CBN Director, Banking Supervision Department, Mr. Haruna Mustafa.

The CBN stated that in compelling circumstances where cash withdrawal above the limit is required for legitimate purposes, such request shall be subject to a processing fee of 3 per cent and 5 per cent for individuals and corporate organisations respectively.

The central bank, in yielding to public pressure on the review, noted that it recognises the role that cash plays in supporting underserved and rural communities and would ensure an inclusive approach as it implements the transition to a more cashless society.

The apex bank had on December 6, introduced revised cash withdrawal limits in banks and other financial institutions following its recent currency redesign project.

The bank had restricted the maximum cash withdrawal over the counter (OTC) by individuals and corporate organisations per week to N100,000 and N500,000 respectively.

The CBN stated, however, that withdrawals above these thresholds will attract processing fees of 5 per cent and 10 respectively for individuals and corporate entities going forward.

In addition, third-party cheques above N50,000 shall not be eligible for OTC payment while extant limits of N10 million on clearing cheques still remain.

The new withdrawal regime further pegged the maximum cash withdrawal per week via Automated teller Machine (ATM) at N100,000 subject to a maximum of N20,000 cash withdrawal per day.

Although most analysts lauded the policy as a step in the right direction to tackle corruption, insecurity, and vote-buying by politicians, others regarded the move as politicised.

But the CBN Governor, Mr. Godwin Emefiele, earlier clarified that the new cash withdrawal limits expected to be implemented from next month were not politically motivated, insisting that it was for the overall benefit of the economy.

He insisted that cash withdrawal limits remained subject to review, adding the deadline of January 31 to deposit all old notes remains sacrosanct.