There is the fear that the new restrictions by the Central Bank of Nigeria, CBN on cash withdrawals may result in financial exclusion for the poor masses and impoverish them the more.
CBN had yesterday ordered Deposit Money Banks (DMOs) and other financial institutions to ensure that weekly over-the-counter (OTC) cash withdrawals by individuals and corporate entities do not exceed N100,000 and N500,000, respectively.
The apex bank made this known in a circular signed by CBN Director of Banking Supervision, Haruna Mustafa.
The circular directed that only denominations of N200 and below shall be loaded into the ATMs, while the maximum cash withdrawal via point of sale (PoS) terminal shall be N20.000 daily.
The apex bank noted that the new policy is sequel to the launch of the redesigned N200, N500 and N1,000 notes by President Muhammadu Buhari on November 23, 2022.
Reacting to the development, a co-chair of the Open Government Partnership, OGP in Anambra State, Prince Chris Azor expressed worry that the new policy may aggravate the problems it was meant to solve.
According to him, the CBN should think the directive through.
“My take is that the new CBN restrictions on cash withdrawals to paltry N20,000 daily, may exacerbate the problems it was purportedly meant to solve.
“Granted that CNN wants to strengthen its cashless policy, while checking insecurity.
“However, it may eventually target the poor masses who could hardly afford the extra 10% charges on extra withdrawals.
“The big guys can afford the charges especially, when it is illegitimate fund.
“The timing is inappropriate, as it falls within the period most average citizens would have exhausted their seasonal savings during the festive period.
“The outcome may further exacerbate the existential challenges of financial exclusion of the poor masses. Pray, how many banks operate at the rural areas and Communities,” he said.
On the limit for POS withdrawals, Azor, who is the Chairman, Anambra Civil Society Network (ACSONET), worried that the POS operators may likely go out of business and this will worsen the insecurity challenges as these groups will look for criminal means of survival.
Azor noted; “When the strong and powerful men are deprived of cash, they pounce on the poor masses mainly farmers, with goods and forcefully dispossess them.
“Such dondition degenerates to the Hobbesian state of nature that’s short, nasty and brutish. Even brutal.
“CBN and its handlers need to think this through.
“Beyond the face value intendment of cashless policy strategy and security checkmate, we may move further into financial exclusion of the vulnerable poor masses.
“The outcome would be disastrous and counter-productive in the long run.”