Nigeria Central Bank increases withdrawal limit to N500,000

The central bank of Nigeria has significantly increased the weekly withdrawal caps it had set, relaxing the constraints it had imposed to reduce the use of cash.

From a cap of 100,000 Nigerian naira ($225) on December 6, people can now withdraw up to 500,000 ($1,122) per week. Companies would now be able to withdraw five million naira ($11,220) every week as opposed to the previous cap of 500,000 naira.

“The Central Bank of Nigeria (CBN) recognises the vital role that cash plays in supporting underserved and rural communities and will ensure an inclusive approach as it implements the transition to a more cashless society,” Haruna Mustapha, the CBN director of supervision, said in the circular announcing the revised limits.

Some observers claimed that the prior withdrawal limits could harm both residents and companies because the majority of Nigerians do not have bank accounts and shop at unofficial markets where cash is preferred.

The central bank also began issuing newly designed 200, 500, and 1,000 naira notes last week as part of a strategy to reduce double-digit inflation and transition to a cashless society. Old notes must be turned in by January 31 or they will no longer be accepted as lawful money.

Amounts above the limitations can be requested by people and companies who are in a tight spot. Processing costs range from 3% for private parties and 5% for businesses. Prior to this, even for exceptional situations, the limits were 5 million and 10 million naira ($11,220 and $22,440), respectively.

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