The new cash withdrawal limits that are anticipated to go into effect starting next month were not politically motivated, insisted Mr. Godwin Emefiele, Governor of the Central Bank of Nigeria (CBN), in a statement yesterday.
He stressed that although the January 31st deadline for depositing all old notes is sacred, cash withdrawal limitations are open to reconsideration.
The CBN governor also announced that deposit money banks would begin dispensing the revised N200, N500, and N1,000 banknotes to consumers before the originally anticipated December 15 deadline.
After seeing President Muhammadu Buhari in his hometown of Daura, Katsina State, Emefiele revealed this to the media.
The president also reaffirmed his unwavering support for the project to redesign the naira, as well as the updated cashless policy, which set a limit on the amount of physical currency that may be withdrawn at any given moment.
New cash withdrawal restrictions for banks and other financial institutions were implemented by the CBN on Tuesday. The recent currency redesign project, which voiced worries about the large amount of cash outside the banking system, was followed by the new policy.
The maximum cash withdrawal over the counter (OTC) by individuals and corporate organizations each week is now limited to N100,000 and N500,000, respectively, under the new regime.
However, the CBN had said that going ahead, withdrawals beyond the levels will be subject to processing fees of 5% and 10% for both private persons and business entities. Additionally, while the current clearing cheque restrictions of N10 million are still in effect, third party checks over N50,000 would not be eligible for OTC payment.
The new withdrawal rule also set a weekly cap of N100,000 on the most cash that may be withdrawn using an ATM, with a daily cap of N20,000.
However, the House of Representatives ordered the Central Bank of Nigeria (CBN) to halt the execution of the policy yesterday and invited Emefiele to testify before it on the following Wednesday.
The initiatives being made to position Nigeria at the forefront of digital payment technologies in Africa and the wider globe, according to Emefiele, were met with satisfaction by Buhari.
After seeing the president, Emefiele told reporters, “The president says he is happy and that we do not need to fear about anyone and that we should keep on.”
Contrary to rumors, Emefiele reiterated that there was no going back on the cashless policy and added that nobody was the objective of it.
The CBN governor added that the institution would shortly accept the Senate’s invitation to update the senators on its most recent policy direction.
Adding that it was “simply meant for the good and growth of the Nigerian economy,” he reiterated that the apex bank’s policies were in the best interests of Nigerians and the economy at large.
The cashless strategy began in 2012, but Emefiele continued, “It is crucial for me to emphasize that on about three to four occasions, we have had to halt the program because we believed that there was a need for us to brace ourselves and strengthen our payment system infrastructure in Nigeria.
“We feel that many electronic channels have been put in place between 2012 and now, which is roughly 10 years, to help people execute banking and financial transactions in Nigeria.
His words were as follows: “Having super agents, which are different from the banks and different from MFB’s other financial institutions, is as good as saying we are having 1.4 million banking points where people can conduct banking services. We think that Nigeria, as a big country and the largest economy in Africa, that we need to leapfrog into the cashless economy.
“We cannot keep allowing a scenario in which more than 85% of the cash in circulation takes place outside of banks. I’ve said it in several forums that cashless transactions are not targeted at anyone as more and more nations embrace digitalization.
He declared, “We don’t want to make their lives miserable; nobody should be alarmed; the CBN is keeping an eye on everything.”
“I can guarantee everyone that it will go around, but let us be calm and be patient,” Emefiele continued in reference to the new bills. Fortunately, the old money will still be accepted until January 31, 2023. Both the painted and unpainted ones will be accepted as legal tender, however the unpainted ones will be useless to you by January 31.
“At the CBN, we have accepted more than half a trillion, and the banks will have something in the neighborhood of half a trillion. What we have done is shift more people into currency processing so that we can process as rapidly as possible and then banks can go from there.
“The president says he’s happy, we shouldn’t be afraid of anyone, and we should keep going,”
Relatedly, the CBN has informed bank clients that its policy on cash withdrawals will not hinder depositors from accessing their money.
Additionally, it urged Nigerians to conduct commerce through alternate channels.
Musa Itopa Jimoh, the CBN’s director of payment system management, stated on the Arise News Channel that it was crucial to clarify to Nigerians that the CBN was not stopping anyone from stealing their money.
“It is doable if you go to a bank to withdraw money; we merely push a boundary. There are different methods by which you can access your money; you are not limited to cash. It is also accessible electronically.
“Today, retail establishments are pleading with banks to send out PoS terminals. In reality, some retail establishments will designate a unique location for cash payment; all other points are for electronic payment.
Haruna Bala Mustafa, Director of the CBN’s Banking Supervision Department, asserted that the CBN is still apolitical and denied any political motivation for the policy. He insisted that the top bank was not under any pressure.
He claimed that the apex bank’s statutory obligation was fulfilled by the cash limitation policy.
He continued by stating that the goal of the policy was to boost economic growth, increase payment system efficiency, and transmit monetary policy.