Ref: COD/DIR/GEN/CIT/05/031 20th April, 2011
All Banks,
CIT Companies,
Payments System Service Providers
Switches,
Card Acquirers,
Issuers and Processors.

INDUSTRY POLICY ON RETAIL CASH COLLECTION AND LODGEMENT (IITP/C/001)

In view of increasing dominance of cash in the economy with its implication for cost of cash management to the banking industry, security, money
laundering, etc., the Central Bank of Nigeria, in collaboration with the Bankers Committee, is adopting policies to reduce the high usage of cash,
moderate the cost of cash management and encourage the use of electronic payment channels.

Consequently, the Central Bank of Nigeria hereby directs as follows:

1. Commencing from June 1, 2012, a daily cumulative limit of N150,000 and N1,000,000 on free cash withdrawals and lodgments by individual and corporate customers respectively with Deposit Money Banks (DMBs) shall be imposed. To this end, individuals and corporate organizations that make cash transactions above the limits will be charged a penal fee of N100/thousand and N200/thousand respectively for amounts above the cumulative limits.

2. Contravention of this policy shall attract a fine of five (5) times the amount that the bank waives as a first offender. Subsequently, the
bank shall pay ten (10) times the charges waived.

2. Furthermore, 3rd party cheques above N150,000 shall not be eligible for encashment over the counter. Value for such cheques shall be received through the clearing house. If a bank allows 3rd party cheque encashment, it shall be liable to a sanction of 10% of the face value of the cheque or N100,000 whichever is higher.

3. Banks will cease cash in transit lodgment services rendered to merchant-customers from June 1, 2012. In this regard, customers could engage the services of the CBN licensed cash-in-transit (CIT) companies to aid cash movement to and from their banks at mutually agreed terms and conditions. Contravention of this policy shall attract a fine of N1.0 million per specie movement.

4. This arrangement shall be in force in Lagos state, F.C.T., Port Harcourt, Kano and Aba in the first instance. The arrangement shall be extended to other parts of the country at a date to be determined by the Bankers Committee.

5. To achieve interoperability of local currency POS transactions, no card scheme, foreign or local, shall operate exclusive acquirer agreement or contract in Nigeria with effect from June 1, 2011. Any payments scheme, processor, switching company, service provider or bank that contravenes this policy may be suspended for a minimum of one (1) month by the CBN as a processor, switching company, service provider etc in the first instance. The license may be withdrawn by the CBN if the contravention is repeated.

6. This policy shall apply to both private and public sector transactions. All financial institutions including Deposit Money Banks, Savings and
Loans, Mortgage and Microfinance Banks shall comply accordingly.

7. Compliance with the policy shall be monitored by the Banking Supervision Department and the Other Financial Institutions Supervision Department with appropriate sanction applied to erring institutions.

While the Central Bank of Nigeria will make general announcements and carry out public awareness programmes individual banks are expected to
do same. The affected customers of banks should be informed in good time by the banks with clear advice on alternative electronic payment channels available to them.

Muhammad Nda
Director, Currency Operations Department

enyojo:

I think I agree with Seun and the CBN Gov on this.
The truth is that we all cry about high rate of inflation and high case of money laundering.
Yet we are attacking a great policy that is capable of creating a cashless society.


This policy is capable of forcing all of us into operating without carrying raw cash.
Many times, I withdraw atleast N500K a day and it is really great danger taking that home.
We all have adjustments to make here

lovejo:

i think uneducated business man will not release his goods to me except he can confirm his money, this will cause many crisis between literate and illiterate.

I think I agree with Seun and the CBN Gov on this.

You agreed with Seun my backside, have u thought of the implication,

So what is the essence of the policy @enyojo, @seun and others that support the policy, is it to frustrate innocent business men and women ? ?

enyojo:

I think I agree with Seun and the CBN Gov on this.
The truth is that we all cry about high rate of inflation and high case of money laundering.
Yet we are attacking a great policy that is capable of creating a cashless society.

enyojo:

This policy is capable of forcing all of us into operating without carrying raw cash.
Many times, I withdraw atleast N500K a day and it is really great danger taking that home.
We all have adjustments to make here

Kobojunkie:

What has cash flow, or high rate of inflation to do with high case of money laundering? A Cashless society? Where have you actually ever seen that one? Even in Japan, people still pay for stuff, outside of the core cities, with cash. Abeg make we stop creating these utopic pictures of ideas. Also, with a cashless system comes more headaches like electronic fraud etc. Preventing and managing these things cost equally as much as it would, probably even more since banks, and governments need to be constantly ahead of the hackers and criminals, than it would cost to achieve same in a cash society.
And you think Operating without cash in a country where to date majority of the transactions happen underground(open, unmonitored market) will help do what exactly? Operating without cash in a country where 80% of the people live poor, and many are unable to afford bank accounts, let alone ATM cards, will do just what for the sole proprietors/small business owners who have to deal with these consumers?

We can make adjustments without monstrous policies like this one. Allow people change as they get to the point where they can-- we did it when cell phones came in-- didn't we?

Gekko:

of all these poor people, how many of them folks conduct more than 150,000 / 1 million in transaction per day? You make it sound as if cash is being eradicated all together.