*The Central Bank of Nigeria clarifies the revised cash withdrawal limits are not particularly targeted at Point of Sale agents, but the West African country needs to take the cashless policy to ‘a high level, if we must make progress in line with global trends’

Gbenga Kayode | ConsumerConnect

In a direct response to the recent outcry by the Point of Sale (PoS) terminal operators over the Bank’s policy direction on cash withdrawal limits, the Central Bank of Nigeria (CBN) has disputed claims that its latest policy limiting cash withdrawals is particularly targeted at the PoS agents in the country.

As part of its overall monetary policy initiatives, the CBN recently sent a circular to the Deposit Money Banks (DMBs) in regard to fixed weekly cash withdrawals for individuals at N100,000 and corporate bodies at N500,000 respectively.

The Bankers’ Bank as well made allowances for compelling cases to withdraw up to N5 million or N10 million in the West African country’s payments ecosystem.

ConsumerConnect had reported the PoS operators in a written petition, dated December 16, 2022, to President Muhammadu Buhari, are seeking upward reviews of the current daily cash withdrawal limits, via Over the Counter (OTC), and other electronic payment platforms.

AMMBAN seeks suspension of cashless policy

The PoS operators, under the auspices of the Association of Mobile Money and Bank Agents of Nigeria (AMMBAN),  urged the suspension of the policy.

They also appealed to the President to prevail upon the apex bank to review upwards the current maximum daily withdrawals via Over the Counter (OTC), and other electronic payment platforms from

Mr. Victor Olojo, National President of AMMBAN, at a press conference held Friday, December 16, in Abuja, FCT, said over 1.4 million people would lose their jobs, if the cashless policy is not suspended or reviewed upwards.

AMMBAN, particularly, requested an upward review of the maximum withdrawal limit to N500, 000 weekly for individuals, and N3 million for corporate organisations.

Policy for economic development as PoS agents are not endangered –CBN Director

In clarifying the stance of the CBN on the matter, however, Mustafa Haruna, Director of Banking Supervision, while featuring on a Channels TV programme aired Saturday, December 17, and monitored in Lagos, said: “Let me just correct an impression: not in any way are they (PoS agents) endangered.

“When you do the numbers, how much does a typical agent outlet need in a day?

“People need to just see this as a policy that is intended at contributing to economic growth and development, and when Nigerians know the enormous benefits inherent in this policy, I’m very sure it will shift mindsets.”

Haruna explained “it is typical when you introduce something new, there is always that trepidation and apprehension.

“But that is why we are also combining it with extensive and sustained campaigns and sensitisation just to ensure that Nigerians understand what is at play, what is involved, and what is in it for them.”

Conditions for exceeding cash withdrawal limits

The CBN Director of Banking Supervision also cited the Bank’s December 6 circular, which stated that in “compelling circumstances”, should an individual or organisation need an amount above the set limits, there are conditions to fulfill.

He restated the CBN had noted that in such instances, not exceeding once a month, withdrawals above the limit shall be subject to processing fees of five and 10 percent for individuals and corporate entities respectively.

These are in addition to “enhanced due diligence and further information requirements,” said he.

The CBN said such applicants are required to upload the following on the CBN’s portal: Valid means of identification of the payee (National ID, International Passport, Driver’s Licence); Bank Verification Number (BVN) of the payee; and notarised customer declaration of the purpose for the cash withdrawal; senior management approval for the withdrawal by the Managing Director of the drawee, where applicable; and approval in writing by the Managing Director/Chief Executive Officer of the DMB authorising the withdrawal.

Haruna further explained that the Bank had seen exponential growth in the agent networks around Nigeria, describing them as “quite ubiquitous.”

The Director as well acknowledged the importance of such banking agency networks across Nigeria, as he said: “There is hardly any nook or cranny in Nigeria where you go that you won’t see one agent outlet or the other where they do cash-in, cash-out services. Such customers can take advantage of those services.”

Rationale for CBN’s expanding  cashless policy in economy

As regards the need to extend the pilot cashless economy idea started in select Nigerian cities  years back, Haruna said: “About the quantum of Naira such customers would need, of course, this is an evolutionary process; we will get there.

“And if you have such a need for a high volume of cash, you can always go to your bank to say, ‘Look, this is my business,’ and they will be able to (attend to you).’ ”

The CBN policy, he stressed, is about expanding the cashless policy first launched a decade ago as a pilot programme in major cities, such as Lagos and Abuja.

Scaling up the policy is necessary due to the high cost of currency management, Haruna stated.

The CBN Director of Banking Supervision added: “We started since 2012, and we had some charges that you have to pay, although the revised limits and charges are different from what we had.

“This is not something new. We feel we should take things to a high level, if we must make progress, in line with global trends.”