The Central Bank of Nigeria (CBN) has announced a major overhaul of its cash handling policies, removing all limits on deposits and significantly increasing the amount individuals and businesses can withdraw each week.
Key Policy Changes and New Limits
In a circular titled "Revised Cash-Related Policies" signed by Dr. Rita Sike, Director of the Financial Policy & Regulation Department, the apex bank outlined sweeping changes. Effective from January 1, 2026, the cumulative limit on cash deposits has been completely scrapped. Furthermore, the fee that was previously applied to deposits exceeding the old limit will no longer be charged.
The CBN has also reviewed the weekly cash withdrawal limit across all channels. For individuals, the new limit is set at N500,000, a substantial increase from the previous N100,000. Corporate entities will now have a weekly withdrawal ceiling of N5 million.
Excess Charges and Specific Channel Rules
Withdrawals that exceed these new thresholds will incur charges. For individual customers, the excess withdrawal fee is 3 per cent, while corporate customers will pay 5 per cent. This revenue will be shared between the CBN and the operating bank in a 40:60 ratio.
The circular provides specific guidance for different transaction methods:
- ATM Withdrawals: The daily limit remains at N100,000 per customer, contributing to the overall weekly cap of N500,000.
- Over-the-Counter Cheques: The encashment limit for third-party cheques stays at N100,000 and counts toward the weekly total.
- Special Authorisation: The previous monthly allowance that permitted individuals to withdraw N5 million and corporates N10 million has been abolished.
Banks have also been directed to ensure ATMs are loaded with all currency denominations to improve service.
Policy Rationale and Exemptions
The CBN stated that the policy revisions aim to reduce the cost of cash management, strengthen security, and mitigate money laundering risks linked to Nigeria's high dependence on physical currency. The bank noted that earlier policies were designed to encourage electronic payments, but current realities necessitate an update.
Certain accounts are exempt from the new withdrawal rules and associated fees. These include the revenue-generating accounts of federal, state, and local governments, as well as accounts held by microfinance banks and primary mortgage banks with commercial banks.
Notably, the CBN has removed a long-standing exemption previously granted to embassies, diplomatic missions, and aid-donor agencies, who must now adhere to the new limits.
Finally, the CBN has mandated that all banks submit monthly returns to its relevant supervisory departments, including Banking Supervision and the Payments System Supervision Department, to ensure compliance.
