The Central Bank of Nigeria (CBN) is restricting the amount of cash that consumers and businesses can withdraw from ATMs to 20,000 naira (US$45) per day and 100,000 naira (US$225) per week.
It has also instructed banks to encourage customers to use the country’s eNaira central bank digital currency (CBDC) and digital payment channels — including mobile and online banking and card payments — instead of cash.
Cashback transactions at the point of sale will also be limited to 20,000 naira (US$45) a day while over-the-counter cash withdrawals in banks will be restricted to 100,000 naira (US$225) per week for individuals and 500,000 naira (US$1,128) a week for business customers, a CBN directive to Nigeria’s banks and financial institutions states.
The central bank is introducing the revised cash withdrawal limits in January 2023 “in line with the cashless policy of the CBN” and, rather than withdrawing cash, “customers should be encouraged to use alternative channels (internet banking, mobile banking apps, USSD, cards/POS, eNaira etc) to conduct their banking transactions”, the directive says.
Customers will still be able to make in-person cash withdrawals above the revised limits “for legitimate purposes” and “in compelling circumstances, not exceeding once a month”, but will be charged a 5% or 10% processing fee per withdrawal and will be required to provide state-issued identity documents, a “notarized customer declaration of the purpose for the cash withdrawal” and written authorisation by the CEO of the bank approving the transaction.
Banks will also be required to report all such transactions on “the CBN portal created for the purpose”.
The CBN launched the eNaira in October 2021, announced in November 2021 that nearly 500,000 consumers had downloaded the eNaira digital wallet and in June this year began letting consumers use feature phones to make CBDC payments.