CBN Reintroduces Charges On Cash Deposits, Withdrawals

In a circular to all commercial banks on Thursday, the Director, Banking and Payment System, CBN, Mr. ‘Dipo Fatokun, stated that the decision was made on the backdrop of the 493rd meeting of the Bankers’ Committee which was held on Bankers’ Committee.

According to him, the committee reviewed the cashless policy charges on withdrawal and deposit and decided that the policy be extended to the 30 remaining states of the federation.

Only six states have been operating the cashless policy before now. These are the Federal Capital Territory, Lagos, Ogun, Anambra, Abia, Kano and Rivers States.

The apex bank further directed that with effect from April 1, 2017, banks in the states where the cashless policy was already operating would begin to impose charges on deposits and withdrawals above N500,000.

Banks will from that date begin to charge individuals 1.5 per cent and two per cent for deposits and withdrawals between N500,000 and N1m.

According to the circular, individuals depositing or withdrawing between N1m and N5m will be charged two per cent and three per cent, respectively.

Similarly, for amounts above N5m, banks will charge such individuals three per cent and 7.5 per cent for deposits and withdrawals, respectively.

On the other hand, for corporates with cash less than N3 million, for deposit and withdrawals, there would be no charge.

But firms with cash between N3 million and N10 million, depositing such would attract two per cent charge, while withdrawals would attract five cent of the amount when the policy takes off. Also, for cash between N10 million and N40 withdrawn from a corporate account holder, three per cent would be charged for deposit and 7.5 per cent for withdrawals. For cash above N40 million, deposit is five per cent and withdrawals is 10 per cent.

The new charges would take effect from April 1, 2017, in the existing cash-less states (Lagos, Ogun, Kano, Abia, Anambra, Rivers and the FCT).

However, the policy shall be implemented with the charges taking effect on May 1, 2017, in Bauchi, Bayelsa, Delta, Enugu, Gombe, Imo, Kaduna, Ondo, Osun and Plateau States according to the CBN.

Meanwhile, the policy would be implemented with the charges taking effect on August 1, 2017, in Edo, Katsina, Jigawa, Niger, Oyo, Adamawa, Akwa Ibom, Ebonyi, Taraba and Nasarawa State.

“The policy shall be implemented with the charges taking effect on October 1, 2017, in the following states: Borno, Benue, Ekiti, Cross River, Kebbi, Kogi, Kwara, Yobe, Sokoto and Zamfara. The income generated from the processing fees charged above the allowable cash transaction limits shall be shared between CBN and the banks in the ratio of 40:60.

“Existing exemptions remain sustained for revenue generating accounts of the federal, state and local governments (lodgments only). Embassies, diplomatic missions, multilateral and aid donors in Nigeria are also exempted from all processing fees relating to the cashless policy implementation,” the CBN explained.

The CBN also advised the commercial banks to enlighten their customers on the new cashless policy.