The House of Representatives has mandated the Central Bank of Nigeria (CBN) to halt the proposed revised cash withdrawal limits policy. The proposed new policy is expected to commence from 9 January, 2023.
The mandate was contained in a resolution passed, sequel to the adoption of a motion on the ‘Need for the Central Bank of Nigeria To Rescind Its Decision On Revised Cash Withdrawal Limits’. It was sponsored by Honourable Aliyu Magaji.
The decision of the lower chamber of the National Assembly was in response to the directive by the apex bank that maximum cash withdrawal over the counter (OTC) by individuals and corporate organisations per week shall henceforth be N100, 000 and N500, 000, respectively.
The CBN had also directed that maximum cash withdrawal through Point Of Sale (POS) shall not exceed N20, 000 daily.
In his lead debate, Honourable Magaji sought for the House intervention. He observed that the CBN, “on the 6th day of December 2022, via a letter marked BSD/DIR/PUB/LAB/015/069, signed by one Haruna B. Mustafa (the Director of Banking Operations), issued the following releases to the public:
“The maximum cash withdrawal over the counter (OTC) by individuals and corporate organisations per week shall henceforth be N100,b000.00 and N500, 000, respectively.
“Withdrawals above these limits shall attract processing fees of five per cent and 10 percent, respectively.
“Third party cheques above N50, 000 shall not be eligible for payment over the counter, while extant limits of N10, 000, 000 on clearing cheques still subsist.
“The maximum cash withdrawal per week via Automated Teller Machine (ATM) shall be N100,000.00 subject to a maximum of N20,000 cash withdrawal per day.
“Only denominations of N200.00 and below shall be loaded into the ATMs.The maximum cash withdrawal via point of sale (PoS) terminal shall be N20,000.00 daily.
“In compelling circumstances, not exceeding once a month, where cash withdrawals shall not exceed N5,000,000.00 and N10,000,000.00 for individuals and corporate organisations, respectively, and shall be subject to the referenced processing fees in (1) above, in addition to enhanced due diligence and further information requirements.”
Honourable Magaji said: “The House is aware that majority of the small business owners in Nigeria are the major drivers of the Nigeria’s economy, and who are majorly residents of rural area and carried on their business, trade and activities in the said rural business areas.
“The House is further aware that the majority of these small business owners transacts their businesses, trade and transactions in physical cash and are, in most cases, not inclined to the use of electronic banking system as most of them are either illiterate, half educated or not learned at all.
“The House is disturbed that these set of Nigerians who are the drivers of Nigeria Economy will be seriously negatively affected and their business and source of livelihood may be seriously impaired with these new directives of CBN.
“The House is also disturbed that this directive of CBN has been generating serious uproar and given low business owners serious concern since the said released as a result of the impact it may have, given short time notice given by CBN.
“The House acknowledged that CBN has the right to issue monetary policies on the Nigeria economy to be able to guide and direct the economy to the right part of recovery and growth.
“The House is concerned, however, that the new policies rolled out by CBN will definitely have a negative impact on the already dwindling economy, and further weakens the value of Nigeria as Nigerians may resolve to using dollars and other currencies as a means of trading and thus further de valued Naira and weakens the economy.”
He further stated: “My heart bleeds for the people who voted us into power, we seem to come to Abuja and forget about them and this is my opinion.
“Only a month ago, we woke up to hear that there will be new currency notes, change of the currency notes. As far as I am concerned, there is no single bank in my constituency.
“I do not know how my people will go and change this money. I do not know where my people will go and get it. The best we have is the POS, our people still deal in physical cash.
“It is good to have cashless policy but we seem to be borrowing ideas and policies from other countries that are far ahead of us.
“We are comparing ourselves with the United States and the United Kingdom. These people are far ahead of us. We will get there one day but these type of policy disturbs the people that voted for us.
“The issue affects everyone. Most of our people are in rural areas and everything is being done in Naira and cash and somebody will wake up and make a policy that will start tomorrow, no consultation.
“People have forgotten that 80 to 90 per cent of our people are in the rural areas. We must do something to save the situation. If there were enough banks and facilities, why not? It will work. I urge colleagues to support this motion so that this policy will be rescinded.”
Contributing, Honourable Aminu Suleiman, who frowned at the effects of the policy pronouncement, said: “This could be an exit board for many of us if we allow this radical decision to succeed and therefore my voice must be heard on this.
“There are several government chief executives in this country that have outlived the essence of their positions because I cannot simply understand how we can wake up one day and introduce this draconian approach to businesses, giving Nigerians one month to adjust their belts.
“More than 70 per cent of communites in this country do not have banking system. Only few like Lagos, Rivers, Kano and probably Delta states might boast of about 70 per cent banking coverage.
“Yet the CBN, under the almighty Godwin Emiefele, woke up and introduced this very heartless decision. This will completely eradicate all the successes we have gathered as a country in order to arrest restiveness and banditry.
“This is because the little intervention we have made by introducing small-scale businesses will be completely whipped out. Thousands of Nigerians have come to live and to do business through the POS.
“All these will go away with the introduction of this policy and I cannot understand how Nigerians will be able to manage our businesses that is predominantly in cash with a withdrawal of N100, 000 per day.
“I think that, beyond rhetoric, we should search our books and impose necessary legislation to ensure we arrest the situation. We have more powers and we can look into the powers of the CBN and remove the excess powers for us that we can act on behalf of Nigerians.
“To allow this means every other chief executive is independent and they can just go and brief the president and he will give them the bearing, we must arrest these things and ensure that it is not done.”
Reacting to the import of the policy, House Minority Leader, Honourable Ndudi Elumelu, who described the development as unfortunate, argued that: “For the first time in the history of this Parliament, I will speak against my friend and I will do that for one reason.
“Part of the problems that is enforcing kidnapping and all vices that are very inimical today, if you go to the communities today, they will ask them to contribute money is because there is cash everywhere.
“If you want to stop banditry, make it impossible for them to have cash, there should not be available cash for them.
“Secondly, we passed the law on this floor; it is our law. The fact that the CBN has been sleeping all these while and never went into the law passed and to follow it to the latter does not mean that it was not there.
“They are only now waking up to implement the law we sent to them. If we want to amend it, we have to amend the law. It will not come by a resolution and that is the truth.
“No matter how bad we feel, no matter how we feel that our people will be endangered, in think the right thing is to amend the existing law.
“On the issues of cashless policy, I think that is the best thing that can happen to this country, even though the timing might be difficult. We may ask for an extension of time for it to be well implemented.
“The policy will help, stories are going round Abuja, even when people go to use the POS to withdraw money, they are people waiting to cut off their hands to collect the money.
“If there is cashless policy and people use their phones to transfer money, some of such things will not happen and that is the truth. There was a time when banks went to the markets to mop up cash after sales.”
Also speaking, Chairman, House Committee on Aviation, Honourable Nnolim Nnaji, observed that: “In the last one month, we have experienced CBN policies, the currency change and now we are talking about cash withdrawal limit.
“This decision is totally against commerce, there is nowhere in the world; in the economic situation we are in now, we need more spending than savings.
“The only way to drive an economy in this situation is for people to be spending money, not saving money, for businesses to be moving.
“We cannot at this point subject ourselves to one man. The decision is totally wrong and all of us must rise and say no because it affects the people it affects.
“Yes the CBN has the power to do so but we also represent the people and before you let such decision out, we, as the representatives, should be aware. So, we can see how we can face the people.”
To this end, the federal lawmakers urged the apex bank to rescind the new policy because of the disadvantages earlier enumerated above, and given the short notice.
The lawmakers also tasked CBN to do more advocacy, enlightenment and sensitisation of small business holders across the country before issuing policies and directives that may affect their business concerns.
The House further urged CBN to give not less than one year notices in case of any plan to issue such similar policies that may touch directly on small business owners in Nigeria.
It also mandated the National Assembly Joint Committee on Banking and Currency and Legislative Compliance to ensure compliance with the resolution.
