Cashless Policy: CBN clarifies confusion on the new charges for withdrawal and deposits

CBN chief Godwin Emefiele (Sun Newspaper Nigeria)
  • NO, you are not going to pay extra N10,000 on every transaction above N500,000.
  • CBN says the Cashless policy is strictly applicable to Cash-based transactions and not on electronic banking.
  • CBN Cashless policy aims at reducing the amount of physical cash (coins and notes) circulating in the economy and encouraging more electronic-based transactions (payments for goods, services, transfers, etc.)

Nigeria's central bank (CBN) has clarified an early confusion surrounding the new charges on withdrawal and deposits for the country's cashless policy.

According to the policy, a withdrawal above N500,000 on an Individual account attracts 3% penalty while deposit above N500,000 will attract 2%.

With this, the new charges generated a lot of controversies among bank customers and stakeholders as many picked holes in it, paving the way for different calculations.

The Nigerian parliament also called for its suspension pending due consultations with relevant stakeholders.

Since then, CBN has explained some of the issues arising from the new charges on withdrawal and deposits.

1. The Cash-less Policy deposit/withdrawal charge is only on the amount above the limit. For instance, if you deposit cash of N501,000, N1,000 is over the limit. The bank will charge you 2% of N1,000 which is N20. The same applies when you deposit more than N5 million

2. The CBN Cashless policy is strictly applicable to Cash-based transactions and not on electronic banking.

3. Under the cashless policy, CBN says the payment of deposit/withdrawal charge is a choice by individuals and businesses. The bank said there are other options to receive and pay out money above the limits without having to pay any charge.

Business Insider SSA understands that this policy is in continuation of CBN's cashless policy. In 2012, the apex bank introduced the policy on cash-based transactions which stipulates a cash handling charge on daily cash withdrawals that exceed N500,000 for Individuals and N3,000,000 for Corporate bodies.

According to the CBN, the new policy on cash-based transactions (withdrawals) in banks, aims at reducing (NOT ELIMINATING) the amount of physical cash (coins and notes) circulating in the economy and encouraging more electronic-based transactions (payments for goods, services, transfers, etc.)

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