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The Nigerian apex bank, Central Bank of Nigeria (CBN), has found a new way to handle cash management to boost the economic system of the country. The central bank has detached all limits and fees on cash deposits. Now, individuals and businesses with a bank account in Nigeria can deposit any amount of cash into their bank accounts without penalties or consequences.
This shows that the central bank is shifting away from its previous cash-management rules introduced in 2022, designed to reduce the economy's reliance on cash. The bank has formed revised rules that remove all limits and fees on cash deposits. The revised rules also bring new withdrawal limits and fees: individual account holders are now allowed to withdraw as much as ₦500,000 in cash per week, and business (corporate) organizations can withdraw up to ₦5 million per week.
Any amount taken beyond these limits will attract extra charges of 3% for individuals and 5% for corporate organisations. The fee will be split between the CBN and the account holder's bank. The apex bank will get 40%, and the banks will receive the remaining 60%. These new CBN withdrawal limits also apply to card withdrawals at ATMs and POS. These withdrawal limits are capped at ₦100,000 per day and ₦500,000 per week. In addition to that, banks are now allowed to stock ATMs with all available naira denominations.
The CBN's circular doesn't leave the cheque aspect unchecked. The circular also states that the ₦100,000 limit which was previously imposed on withdrawing third-party cheques over the counter remains the same. But the cheque limit will now count toward an account holder's weekly withdrawal total — which is ₦500,000 in cash per week for individuals and ₦5 million per week for business organizations.
The central bank says it has released several cash-related policies to further amend its cash-management circulars that were introduced in 2022. The bank emphasized that the new circular is part of its efforts to address security concerns, moderate the rising cost of cash management, and reduce the potential for money laundering. The CBN explained that, “With the effluxion of time, the need has arisen to streamline the provisions of these policies to reflect present-day realities,” noting that the adjustments were necessary to align its rules with current economic conditions.
The circular also states that only money in government accounts and funds held by primary mortgage banks are still exempt from the new limits and charges on cash withdrawals. However, the directive has removed the previous exemptions given to diplomatic missions, embassies, and international aid agencies. These bodies must now follow the new cash rules just like everyone else.
Furthermore, the apex bank instructed banks to file monthly reports with their supervising departments detailing all transactions that go above the set withdrawal limits, including both cash withdrawals and cash deposits. In addition to that, Deposit Money Banks (DMBs) must set up special internal accounts to temporarily hold all processing charges they collect on withdrawals exceeding the limit before the money is eventually shared as directed by the CBN.
This action is part of the CBN's bigger plan to safeguard the entire financial and economic system in Nigeria, in the sense that financial fraud will be reduced and overall efficiency will be boosted. New rules are coming to tackle fraud involving authorized push payments (APP); they require victims to report any scam within 72 hours. Financial institutions, including commercial banks and fintech companies, must then conduct an investigation and process any deserved refund within 16 working days.
