STRATEGIC PARTNERS
Following a one-year waiver period, cash withdrawals via teller or ATM will be subject to a fee of up to 5 percent as the Nigerian government carries out its plan to retool the nation's cash-based economy.
June 25, 2014
The Central Bank of Nigeria has announced the implementation of its third and final phase of the government's cashless policy.
Phase one took effect Jan. 1, 2012, with a pilot in Nigeria's largest city, Lagos, followed by a phase two rollout in the capital city of Abuja and six Nigerian states. In phase three, which will begin as planned on July 1, the remaining 30 states of the federal republic will join the cashless movement, according to a report by Nigeria's Premium Times.
As in previous pilot phases, the CBN will waive cash withdrawal charges in the 30 added states for one year as citizens adjust to the new policy and banks add the necessary infrastructure — including ATMs and POS terminals — and complete the issuance of debit cards. Charges already implemented in previous pilot areas will remain in place.
Withdrawal charges will be implemented on July 1, 2015, in phase three states. These include a cash-handling fee on daily cumulative individual cash withdrawal or deposit amounts that exceed 500,000 naira ($3,073), and on corporate withdrawal and deposit amounts in excess of 3 million naira ($18,437).
Fees are imposed only on the portion of the withdrawal or deposit that exceeds the given limit. Third-party checks of more than 150,000 naira ($922) may not be cashed over the counter, but must instead be processed through a clearing house. The limits apply to all cash withdrawals, whether conducted over a teller counter or at an ATM.
According to a program explanation on the CBN website, the objective of the program is to reduce, not eliminate, the use of cash in Nigeria, which has historically been a cash-based economy. Nevertheless, ATM deployers have objected to the policy, which initially limited withdrawals to 150,000 for individuals and 1 million for corporate entities.
