The Senate on Wednesday asked the Central Bank of Nigeria to considerably adjust the cash withdrawal limits, as criticism trails the recently announced policy that is expected to take effect from Jan. 9, 2023.
The red chamber deliberated on the CBN’s withdrawal limit policy yesterday after a postponement. The deliberation was previously billed to hold on Tuesday in response to growing protest against the policy by the public.
After considering a report from its Committee on Banking and Finance, the lawmakers directed the committee to commence aggressive oversight of the central bank and its commitment to make flexible adjustment to the withdrawal limit.
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The CBN had last month, announced that ATM and over the counter cash withdrawals at the banks have been limited to N100,000 per week for individuals and N500,000 for corporate organizations. POS withdrawal was limited to N20,000 per day while the apex bank directed that only N200 and lower denominations should be loaded into banks’ ATMs.
The policy has however, drawn public outcry, with experts saying that it would stifle economic growth in the country. Consequently, the public outcry drew the attention of the National Assembly. The House of Reps was the first to summon the CBN governor Godwin Emefiele, asking him to suspend the policy.
However, there have been divided opinions on the policy even among lawmakers. While some believe it will have negative economic impact – stymieing business growth for SMEs – particularly in rural areas, others believe that the policy wields many benefits – such as curbing banditry and kidnapping and keeping Nigeria’s free-falling currency, the naira, stable.
The committee made its recommendations, urging the Senate to support the central bank’s policy. But after the matter had been thrown open for deliberation following the report by the committee’s chairman, Uba Sani (APC, Kaduna Central), the senators expressed varying views on the policy.
Opposing the policy, the Senate spokesman, Ajibola Basiru, described the committee’s report as “vague” and the CBN’s policy as “unrealistic.” He said the central bank needs to review the withdrawal limit upward considering Nigeria’s economic realities.
“I am not oblivious of the recommendations of the committee but I am of the suggestion that they should have adjusted the indices…,” he queried. “Why not say N500,000 in place of N100,000. This is in line with the realities. This report is vague.”
Adamu Aliero, Kebbi senator, also in opposition of the policy, said the central bank needs to create a room for flexibility in implementing the policy, considering the country’s realities.
“There are about 774 local governments in the country and only about 60 percent of the 774LGs are covered by banks,” he said. “While I support e-banking and cashless policy, I think we should do it with caution. There should be room for flexibility.”
Against the majority’s opinion, Senator Yusuf Yusuf urged his colleagues to support the policy. He said the policy transcends financial reasons to security, technology and the stability of the naira.
“If I had my way, I’d recommend the highest denomination to be N100. That is the only way to ‘de-dollarise’ the money. Because we are killing ourselves by keeping all the money and keeping dollars…,” he said.
Following its deliberation, the Senate called for adjustment of the policy and mandated its committee on finance to periodically report the outcome of its consultations to the red chamber.