Cash withdrawal limit: Senate invites CBN directors for interrogations

The Senate has invited two deputy governors of the Central Bank of Nigeria for interrogations on Friday over the cash withdrawal limit policy unveiled by the apex bank on Tuesday.

The red chamber planned to seek clarifications on the new directive which restricts over-the-counter cash withdrawal by individuals and organisations to N100,000 and N500,000, respectively, per week.

It also limits cash withdrawals via point-of-sale machines and automated teller machines to N20,000 daily and N100,000 weekly, respectively.

According to a memo signed Tuesday by the CBN’s Director of Banking Supervision, Haruna Mustafa, withdrawals above the thresholds would attract processing fees of five per cent and 10 per cent, 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 N10m on clearing cheques still remain.

The circular also directed banks to load only N200 and lower denominations into their ATMs and restricted withdrawal to N20, 000 per day from ATMs.

 The policy which will become effective on January 9, 2023, had generated criticisms but the CBN clarified on Wednesday that PoS operators could apply for waivers.

Deliberating on the policy on the floor of the Senate on Wednesday, senators said there was a need to debate the policy on the floor of the red chamber.

However, the Senate President, Ahmad Lawan, directed the Senate Committee on Banking to grill the two re-appointed deputy governors of the CBN, Aisha Ahmad, and Edward Adamu, who will be screened on Friday, on the new cash withdrawal policy.

Senators raise motion

The resolution on the new CBN policy followed a move by Senator Philip Aduda (PDP FCT) to move a motion on the development.

Aduda had sought to rally other senators to deliberate on the policy but the Senate President, Lawan, interrupted him, saying it was too early to debate the circular.

Also, Senator Gabriel Suswam (PDP Benue North-East) supporting his colleague and pushed that the motion should be allowed to fly considering the innocent Nigerians that would be affected by the CBN policy.

Addressing Lawan, he said, “I think you should have allowed us to discuss this motion for the sake of Nigerians.”

The President, Major General, Muhammadu Buhari (retd.), had on Tuesday sent for screening and approval the names of the two CBN deputy governors.

PoS operators get waiver

The Director of Corporate Communications of the Central Bank, Mr Osita Nwanisobi, has said that Point-of-Sale operators can take advantage of an exemption to request more cash beyond the new limit.

Speaking with one of our correspondents on the phone, he noted that there is an exemption stipulated in the newly released circular, which PoS operators can take advantage of, based on the requirements and in line with the amount of transactions they process.

He said, “The circular is very clear. If you are doing PoS, it is online and mobile transaction. Whenever cash is involved, then there is a limit. However, there is an exemption in the circular, which PoS operators can apply for based on the volume of their transactions.”

Following the new directive, the National President, Association of Mobile Money and Bank Agents of Nigeria, Victor Olojo, had said that PoS operators would protest against the policy which he said was targeted at killing their livelihood.

Olojo argued that the cash limit would harm their business as it translated to shutting down PoS terminals.

However, there was an exemption that allows up to N5m for individuals and N10m for corporate organisations once a month but with certain requirements.

To enjoy the exemption, banks were required to obtain some information from the drawee and upload the same on the CBN portal created for the purpose.

The requirements include a valid means of identification such as the National Identity Card, international passport, driving licence; Bank Verification Number of the payee; notarised customer declaration of the purpose of the cash withdrawal; senior management approval for the withdrawal by the managing director of the drawee where applicable and approval in writing by the MD/CEO of the bank authorising the withdrawal.

According to the guidelines, monthly returns on cash withdrawal transactions above the specified limits will be rendered to the banking supervision department.

Also, compliance with extant anti-money laundering and countering the financing of terrorism regulations relating to Know Your Customer, ongoing customer due diligence and suspicious transaction reporting are required in all circumstances.

On the likely effect of the policy on the people in the rural areas, who regularly deal with cash, Nwanisobi said, “The policy only states that you cannot go beyond a particular limit. It doesn’t stop anybody from using cash. So, those in the rural area can still transact with the available cash.”