CBN New Policy On Cash Withdrawals Limit: A Time Bomb

By Elizabeth Chukwuma

For over the last three and  half years,  in  thePresident Muhammadu Buhari second term in office, he had  enjoyed  a robust working relationship with  the National Assembly that had made Nigerians to  describe  under the  Lawmakers  as rubber stamp to the Katsina state born Nigerian President policies and Executive proposals.

  Ahmad  Lawan, the Senate President, whom Nigerians had looked expected  to  force the Katsina state born Nigerian President to sit up, may have made matters worse  as he was  always shobnobbing with the Nigerian President that the Senate under his Leadership could not say no  to any of the requests of the President  including requests to borrow money  from multilateral Financial Associations to execute pojects.

Emefiele: CBN, Governor

The National Assembly  Lawmakers may have taken advantage of the Central Bank of Nigeria, CBN, under the close watch of the Delta state born Banker, Godwin Emefiele,  new policy on maximum cash withdrawals limit policy from over the counter, OTC, in any of the Commercial banks and Financial Institutions, operating  in the country, or Automated Teller machines, ATM and Point of Sale, POS, by Indiividuals or Corporate Organisations  per week or on a daily basis, described as killing,  to tell Buhari, that they can  no longer be taken  for granted.

The apex bank  maximum cash withdrawal policy  which had restricted  maximum cash withdrawal  over the counter , OTC,  by individuals  and Corporate Organisations  to N100,000 and N500,000.00 per week respectively a well as  making   ‘’ third –party cheques  above N50,000.00 not to be  eligible  for OTC, payment, withouth the National Assembly approval approval.   

It was aid to have also  set a limit  for cash withdrawals  per week through the Automated  Teller Machine, ATM, at N100,000.00  subject  to a maximum  of N20,000.00 cash  and daily maximum withdrawals of N20,000.00 per day at the Point of Sale, POS.

The National    Lawmakers who may have read the handwriting on the wall that the policy was targeted at certain individuals and the politicians who needed huge amount to prosecute their electioneering Campaigns for the 2023, general elections,  may have been forced  to react to the CBN, new policy ,to win the heart of the leading Opposition party members. who are poised for action because of the hardship in the country.

Philip Auda, Senate Minority Leader, may have given an insight to what the Lawmakers will do in the coming months when he called for a point order during plenary session on Wednesday, December 7, 2022 for the attention of  Colleagues to tell the ne CBN,’’ to reverse the Cash withdrawal policy limit. The Lawmaker was said to have demanded for caution, insisting that ‘’it will affect many Nigerians, especially business owners’’.

I In apparent response to the Senators worry  and the public fear that   the CBN, cash withdrawal limit policy, will affect many Nigerian businessmen and women, Emefile had said that   ‘’it was not intended to hurt anyone  but designed  to strengthen the economy’’ , stressing  ‘’there will be no rigidity  on the implementation policy  and no reversal’’.

The PDP Minority Leader, may have won the heart of the  Senate Leadership,  particular, Senator Lawan, who not be retruning to the upper Chamber ecause   Babaga Machina, using the instrumentality of the Court  has replaced him as  the Senatorial  Candidate for Yobe north of the ruling aAPC, for the 2023, general elections.  .

Gbajabiamila: Speaker, House Of Representatives, Summons Emefiele To Appear Before The House Over Maimum Cash Withdrawals Limit

 Femi Gbajabiamila, led House of Representatives may have taken a cue from the Senate to fight the CBN, maximum cash withdrawal limit  policy by individuals and corporate organisations per week and on a daily basis. The House was said to have summoned   Emefiele, the CBN, governor to appear before it over the bank’s new policy on cash withdrawals on Thursday, December 8, 2022. The House was said to have made its position clear as it had ordered ‘’the suspension of the new policy following a resolution during plenary on the said Thursday, December 8, 2022.

Emefiele , who has the backing of the Nigerian President  may have made the National Assembly Lawmakers  understand that he does not take orders from them  as he was said to have repeatedly told them that ‘’there was no going back  on the policy’’, meaning that it has come to stay. 

Given that  Hajia Zainab Ahmeed, the minister of Finance, Budget and National Planning could not stop  the redesigning of N200, N500 and N10000 notes, despite public support , may have informed why critics had said that  the National Assembly moves  to force the CBN, suspend the maximum cash withdrawal limit  policy would be a wasted efforts.

Aware that the apex bank may not reverse the cash withdrawal limit policy, which the Commercial banks and other Financial institutions operating in the country may not be able to stop, may have given ammunition to Kola Ayeye, an Economist, to lend his voice to what the critics of the CBN,  policy, that he had said that ‘’it is not the nation’s major problem at the moment that should be tackled’’.

He had corroborated the  bank’s views that the policy was initiated  ‘’to reduce the country’ heavy reliance on cash and to further accelerate the digitisation of the economy as obtained in other parts of the world, the Economist had had said that    even if ‘’the bank achieve its objective of introducing the policy, it may be dealing with only six percent of the money supply in the country’’.

Appealing to Emefiele, the CBN, governor, Ayeye, had urged the apex  Bank that   that rather than ‘’waste  much   energy  in trying to control   the money in circulation in the country,  ‘’the bank should focus its attention  to pay the  country’s  mind boggling  external debts which   the Buhari Administration, has accumulated , over the last seven years.

The World Bank  had revealed that as at the end of 2021,  the external debt of debtor nations, particular, those in the poorest and developing economies of the world, including Nigeria, a member of the Organisation of Petroleum Exporting Countries, OPEC,  which had hit  $9 trillion.

 The world  bank had put the country’s external  debt stock at $103 billion as at the end of November 2022, compared to the 2010 figure, of $18.39 billion.The bank  had   had said that the currency depreciation of the indebted  developing economies, including Nigeria,  may have made matters worse   for the nation because ‘’the  accumulated  debts  are  denominated  in the North American country of the United States dollars’’.  

The country was said to have spent  $589.59 million  servicing  the debts  to the World Bank  and the  the Asian country of China, Exim Bank of China .   It was said to have also paid a total of $390.92 million, which included $384.28 million  to the Inte rnational Development Association, IDA and $6.6 million  to the International Bank for Reconstruction  and Development, IBRD.

 This is in addition  to a atotal of $207.67 million  that was said to have been paid  to the Exim bank for different projects in which the loans were taken by past and present and past  Administrations.

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