CBN extends cashless policy to Abuja, Rivers, 3 other states

The cashless policy of the Central bank of Nigeria, which commenced in Lagos one and half years ago, will finally make its landing in  the Federal Capital Territory (Abuja), Abia, Anambra, Kano, Ogun and Rivers States effective July 1, 2013.

Many banks have already started communicating the banks directives on the new policy to their customers, an indication that there is no going back on the extension this time..

The policy, which aims at reducing the amount of physical cash circulating in the economy, and encouraging more electronic-based transactions (payments for goods, services, transfers, etc.), puts restriction on the amount of cash to deposited or withdrawn from customers accounts in a given day .

The banking sector regulator introduced this policy as part of initiatives to drive development and modernisation of the country's payment system.

It aims at encouraging all individuals and corporates to adopt electronic payment and banking options.

To put to effect this policy, the CBN has extended the operational modalities that have been in place in Lagos more than a year ago to the aforementioned states effective July1, 2013:

• The cash-in-transit lodgment and cash evacuation services will no longer be available to customers or merchants.
• 3rd party cheques above N150,000 shall NOT be eligible for encashment over the counter. Value for such cheques shall only be received through lodgments into customer’s account.
• For individual account holders, charges will apply when daily withdrawals and deposits are in excess of N500,000
• For corporate account holders, charges will apply when daily withdrawals and deposits are in excess of N3,000,000.

The Guaranty Trust Bank on Wednesday wrote to its customers, intimating them of these developments.

It particularly explained that 'the above limits apply so far as it involves cash, irrespective of channel i.e over the counter, ATM, 3rd party cheques cashed over the counter etc. For example, if an individual withdraws N450,000 over the counter, and N150,000 from the ATM on the same day, the total amount withdrawn by the customer is N600,000, and the service charge will apply on N100,000 – the amount above the daily free limit of N500,000.'

The bank however noted that exemptions have however been granted on lodgments and withdrawals for accounts operated by Embassies, Diplomatic Missions, Multilateral Agencies, Aid Donor Agencies, Ministries, Departments and Agencies of Government (revenue collections only), Microfinance Banks (MFBs) and Primary Mortgage Institutions (PMIs).