The Central Bank of Nigeria’s limits are part of a larger push to encourage digital financial transactions.
Nigeria has drastically reduced the amount of cash individuals and businesses can withdraw as part of its “cash-less Nigeria” strategy and increased the use of the eNaira, Nigeria’s Central Bank Digital Currency (CBDC).
The Central Bank of Nigeria issued the directive to financial firms in a Dec. 6, individuals and businesses will now be able to withdraw $45 (20,000) per day and $225 (100,000) per week from ATMs, according to the 6 circular, which states that individuals and businesses will no longer be allowed to withdraw $45 (20,000) per day and $225 (100,000) per week from ATMs.
individuals and businesses will be restricted to withdrawing $225 (100,000) and $1,125 (500,000) at banks per week, with individuals and businesses being charged a 5% fee and businesses with a 10% fee for amounts over those limits.
The maximum cash withdrawal via point-of-sale terminals is also limited to $45 (20,000) per day.
Announcing the changes, Director of Banking Supervision Haruna Mustafa announced the changes.
“Customers should be encouraged to use alternative methods (Internet banking, mobile banking apps, USSD, cards/POS, eNaira, etc. to conduct their banking transactions.”
limits are cumulative limits for each withdrawal, so a person withdrawing $45 from an ATM and then attempting to withdraw cash from a bank on the same day would be charged the 5% service fee.
The new limits on daily cash withdrawals were $338 (150,000) for individuals and $1,128 (500,000) for businesses prior to the announcement.
ENaira’s adoption rates have been low since its introduction on Oct. 25, 2021.
The Central Bank of Nigeria has been unable to persuade its citizens to use the CBDC since Oct.
A year since its inception, it was released on April 25, 25 years later.
In 2012 Nigeria established its “cash-less” policy, suggesting a shift away from physical cash would make its payment system more efficient, reduce the cost of banking services, and improve the effectiveness of its monetary policy.
On Oct. 26,The Governor of Nigeria’s central bank stated that 85% of the Naira in circulation was held outside of banks and that it would be reissuing new banknotes with an end goal to drive the shift towards digital payments.