Deposit money banks and other financial institutions are under orders from the Central Bank to make sure that over-the-counter cash withdrawals by individuals and business entities each week do not exceed N100,000 and N500,000.
The instruction is seen in a circular the bank released on Tuesday.
According to the CBN, the rule will go into force countrywide on January 9, 2023.
It explained that once the policy went into effect, processing fees of 5% and 10% would apply to any cash withdrawals that exceeded the specified limits.
“Third party cheques above N50,000 shall not be eligible for payment over the counter, while extant limits of N10,000,000 on clearing cheques still subsist.
“The maximum cash withdrawal per week via automated teller machine (ATM) shall be N100,000 subject to a maximum of N20,000 cash withdrawal per day.”
“Only denominations of N200 and below shall be loaded into the ATMs.
“The maximum cash withdrawal via point of sale (POS) terminal shall be N20,000 daily."
The CBN did specify that such cash withdrawals must not exceed N5 million and N10 million for individuals and business organizations, respectively, in compelling circumstances, not more than once per month, when they are required for lawful purposes.
It stated that these transactions will be subject to processing charges, increased due diligence, and additional information requirements.
“You are required to obtain the following information at the minimum and upload same on the CBN portal created for the purpose:
a. Valid means of identification of the payee (national ID, international passport, driver’s license).
b. Bank verification number (BVN) of the payee.
C. Notarised customer declaration of the purpose for the cash withdrawal.
d. Senior management approval for the withdrawal by the managing director of the drawee, where applicable.
e. Approval in writing by the MD/CEO of the bank authorising the withdrawal,” the circular adds.
The CBN bank also asked Nigerians to note that
“monthly returns on cash withdrawal transactions above the specified limits should be rendered to the banking supervision department”.
“Compliance with extant AML/CFT regulations relating to KYC, ongoing customer due diligence and suspicious transaction reporting etc. is required in all circumstances,” it said.
“Customers should be encouraged to use alternative channels (internet banking, mobile banking apps, USSD, cards/POS, eNaira, etc.) to conduct their banking transactions."
“Finally, please note that aiding and abetting the circumvention of this policy will attract severe sanctions.
“The above regulatory directives take effect nationwide from January 9, 2023.”
Speaking on behalf of CBN, Osita Nwasinobi said that carrying large sums of cash is unhealthy. He said:
“We have a cashless policy. We want people to explore alternative payment channels,”
This might be an indication of the mass implementation of E-naira in the country.