Ethiopia limits cash withdrawals, here is why

Ethiopia’s central bank has issued a directive limiting cash withdrawals for bank customers.

A woman counts Ethiopian birr notes ( REUTERS/Tiksa Negeri)

The Central Bank said the directive is to help tackle tax evasion and encourage more efficient use of money.

Per the directive, an individual can withdraw up to 200,000 birrs ($5,800) a day.

One person can only withdraw 1m birr ($29,000) in a month.

However, businesses can withdraw higher amounts. The Ethiopian central bank said businesses can withdraw around $8,000 per day and close to $74,000 per month.

According to the BBC, the Governor of the central bank, Yinager Dessie, said this directive will help manage liquidity for financial institutions. He added that they would sanction banks and credit companies that fail to comply with the directive.

Ethiopia’s economy is described as a cash-heavy one. Experts have said that this new directive may affect transactions for small businesses as they adapt to the new measures.

Other experts have raised concerns about the timing of the announcement. They believe this is unhelpful in this time when the country’s economy is grappling with the economic impacts of the coronavirus pandemic.

JOIN OUR PULSE COMMUNITY!

Unblock notifications in browser settings.

Eyewitness? Submit your stories now via social or:

Email: news@pulselive.co.ke

Recommended articles

4 side effects of being a virgin for too long, according to research

4 side effects of being a virgin for too long, according to research

Ini Edo posts new photos amid reports of welcoming a baby through surrogacy

Ini Edo posts new photos amid reports of welcoming a baby through surrogacy

KDF moves to forcibly acquire Sh 500M supermarket land in Nairobi

KDF moves to forcibly acquire Sh 500M supermarket land in Nairobi

Zari Hassan lectures Tanzanians over her viral black innerwear video

Zari Hassan lectures Tanzanians over her viral black innerwear video

DP Ruto's firm wins Sh190M Nairobi county gov't tender

DP Ruto's firm wins Sh190M Nairobi county gov't tender

Diana Marua hospitalized, Bahati gives update [Photos]

Diana Marua hospitalized, Bahati gives update [Photos]

Betty Kyallo shares photos of the first Subaru she bought after joining KTN

Betty Kyallo shares photos of the first Subaru she bought after joining KTN

North Korean man who smuggled 'Squid Game' into the country to be sentenced to death

North Korean man who smuggled 'Squid Game' into the country to be sentenced to death

Willy Paul apologizes to Kenyans on Behalf of Diana B

Willy Paul apologizes to Kenyans on Behalf of Diana B