Nigeria Central Bank Increases Withdrawal Limits Aimed At Curbing Cash

Nigeria Central Bank Increases Withdrawal Limits Aimed At Curbing Cash

Nigeria’s central bank significantly increased weekly cash withdrawal limits on Wednesday as part of an effort to reduce the use of cash.

Individuals will be able to withdraw up to 500,000 naira ($1,120) per week, up from a limit of 100,000 set on December 6. Corporates will be able to withdraw 5 million naira per week, up from 500,000 naira previously.

The majority of Nigerians do not have bank accounts and prefer to shop in informal markets, where cash is preferred, and some fear that the withdrawal limits will harm some citizens and businesses.

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“The CBN recognises the vital role that cash plays in supporting underserved and rural communities and will ensure an inclusive approach as it implements the transition to a more cashless society,” Haruna Mustapha, CBN director of supervision, said in the circular announcing the revised limits.

Nigeria Central Bank Increases Withdrawal Limits Aimed At Curbing Cash

The central bank also began circulating redesigned 200, 500, and 1,000 naira notes last week as part of a plan to reduce double-digit inflation and transition to a cashless economy. Citizens have until January 31 to return old notes, after which they will no longer be legal tender.

When individuals or businesses have compelling reasons to withdraw more than the limits, the requests will be subject to a 3% and 5% processing fee, respectively. Previously, even in exceptional circumstances, the limits were set at 5 million and 10 million naira, respectively.