CBN Introduces New Fees on Large Weekly Cash Withdrawals, Accelerating Digital Shift
The Central Bank of Nigeria (CBN) has announced a significant policy change, imposing new charges on weekly cumulative cash withdrawals for both individuals and corporate entities. Effective January 1, 2026, a 3% fee will be applied to withdrawals exceeding N500,000, while a 5% fee will be charged for amounts surpassing N5 million. This move is set to introduce a new dynamic to cash management practices and represents a continued push towards modernising Nigeria’s payment systems.
Strategic Rationale Behind the New Fee Structure
This revised regulatory framework, detailed in a circular signed by Dr. Rita I. Sike, Director of the Financial Policy & Regulation Department, is primarily designed to moderate the escalating costs associated with managing physical cash within the Nigerian economy. The CBN explicitly links this initiative to its broader, long-standing objectives. Previous policies, as the regulator noted, were introduced to address critical security concerns and reduce the potential for money laundering, issues often exacerbated by a heavy reliance on cash. Furthermore, these efforts have consistently aimed to curtail cash usage, thereby encouraging the accelerated adoption of diverse electronic payment channels. Under the leadership of Central Bank Governor Olayemi Cardoso, the institution continues to align its policies with market operations, fostering an environment conducive to a more efficient and digitally-inclined financial ecosystem. This new fee structure is a direct extension of these strategic goals for a less cash-dependent society.
The forthcoming implementation of these withdrawal fees signals the CBN’s unwavering commitment to transforming Nigeria’s financial landscape. While the January 2026 effective date provides a crucial window for adaptation, individuals and businesses alike will need to strategically plan their cash movements and fully embrace the array of electronic payment solutions available. Ultimately, this policy represents a decisive step towards enhancing financial security, reducing operational costs associated with cash, and propelling Nigeria further into the era of digital finance.
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