How the CBN's New Cash Withdrawal Policy Affects You

How the CBN's New Cash Withdrawal Policy Affects You

The Central Bank of Nigeria (CBN)  recently introduced a new cash withdrawal policy. This policy is a follow-up to its introduction of new naira notes and is targeted at encouraging compliance with the CBN's cashless policy.

We break down this policy in simple English and explain what it means for your business.


Let’s look at the provisions of the policy with explainers.

Policy Provision - The maximum cash withdrawal over the counter (OTC) by individuals and corporate organizations per week shall henceforth be N500,000 and N5000,000 respectively. Withdrawals above these limits shall attract processing fees of 5% and 10%, respectively.

What this means - This means your withdrawals when you go into the bank in person will be limited to N500,000 as an individual and N500,000 as a corporate organization. If you need to go above that, you will have to pay a processing fee of 5% as an individual and 10% as a corporate organization.

Policy Provision -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.

What this means- This means if a customer writes a cheque in your name and you go to cash it, you can only collect cash if it is N100,000 and below. For amounts above N100,000, you will not be able to collect some money, it will instead be paid into your account.

The CBN also reminded everyone that the highest amount that can be written on cheques remains N10,000,000

Policy Provision - The maximum cash withdrawal per week via Automated Teller Machine (ATM) shall be N100,000 subject to a maximum of N20,000 cash withdrawal per day.

What this means- This means you can only withdraw a maximum of N20,000 a day with a limit of N100,000 weekly.

Policy Provision - Only denominations of N200 and below shall be loaded into the ATMs.

What this means - This one is easy. Get ready to see N200 everywhere because that is the only denomination that will be loaded into ATMs.

Policy Provision - The maximum cash withdrawal via point of sale (PoS) terminal shall be N20,000 daily.

What this means -  If you use a PoS terminal for withdrawal, you will only be able to withdraw N20,000 daily.

Policy Provision - In compelling circumstances, not exceeding once a month, where cash withdrawals above the prescribed limits is required for legitimate purposes, such 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.

Further to (6) above, you are required to obtain the following information at the minimum and upload same on the CBN portal created for the purpose:

a. Valid means of identification of the payee (National ID, International

Passport, Driver’s License).

b. Bank Verification Number (BVN) of the payee.

c. Notarized customer declaration of the purpose for the cash withdrawal.

d. Senior management approval for the withdrawal by the Managing Director

of the drawee, where applicable.

e. Approval in writing by the MD/CEO of the bank authorising the withdrawal.

What this means- This means that when an individual or corporate organization needs money above the specified limits of  N100,000 and N500,000. They can withdraw up to N5,000,000 for individuals and N10,000,000 for organizations. However, this withdrawal will be subject to processing fees of 5% for individuals and 10% for corporate organizations. It can also be done only once a month.

It will also require some documentation and approvals- a valid means of identification, BVN, a notarized declaration for why you need to withdraw the amount, senior management approval and approval in writing by the MD/CEO.

When Do These Policies Come Into Effect?

The policies will come into effect on the 9th of January, 2023.

What does this mean for me and my business?

The simple takeaway is that cash is no longer king for the CBN! They are dedicated to ensuring that Nigerians go cashless as much as they can. Here’s how you can make sure you and your business are prepared for this transition.

Register Your Business

Registering your business allows you to open a business account. A business account under this policy means you can withdraw more cash than an individual. To register your business without stress, use Kippa Start and get your certificate in days.

Offer More Payment Options

As a business owner, it's time to invest in other ways for your customers to pay for goods and services without cash.

An easy way to do this is to get a POS terminal for your business so you can accept card payments without the stress of carrying cash around. KippaPay offers a reliable network for you to accept card payments easily!

Be Vigilant!

Because of the limited availability of cash, you might see increased attempts to pay for goods and services using fake transfers/alerts. Please stay alert and ensure you receive value for a transaction before you hand over goods and services.

Spread the word!

If you operate in a rural area or have customers that depend on cash primarily to make payments, then it's time to educate them about this policy. Encourage them to open bank accounts so they have access to more payment options (USSD, internet banking, card).

The Kippa content team are not legal practitioners or accredited financial advisors and cannot offer you legal, financial or regulatory advice.  Our analysis and research are obtained through public sources. If you require professional advice and insight, please seek legal advice from a licensed attorney or financial advisor.

Solomon Nzere

Solomon Nzere