Nigeria Limits ATM Cash Withdrawals To Force CBDCs

Due to Nigeria’s desire for a cashless nation, they have limited how much money individuals and companies can withdraw from ATMs and banks in order to promote the use of the eNaira – which is a digital currency issued by the Nigerian Central Bank.

Nigeria has limited atm withdrawal limits for People and businesses to $45 (about 20,000 Naira) each day and $225 (almost 100,000 Naira) per week. According to a Central Bank of Nigeria circular dated December 6th.

The daily cap on cash withdrawals through point-of-sale devices is $45.00. When announcing the amendments, Director of Banking Supervision Haruna Mustafa highlighted the following points:

The daily cap on cash withdrawals through point-of-sale devices is $45.00.

Customers should be encouraged to use alternative channels (Internet banking, mobile banking apps, USSD, cards/POS, eNaira, etc.) to conduct their banking transactions.

If a person withdraws $45 from an ATM on the same day and then tries to withdraw money from a bank. A 5% service charge will be applied because the limits are cumulative for each withdrawal.

The daily cash withdrawal limits for people and businesses were $338 ($150,000) and $1,128 ($500,000), respectively, before the news.

By encouraging the country to accept digital currency instead of cash payments, Nigerian shops and business owners might profit from the growing global trend of crypto payments.

In addition, these new laws, which take effect on January 9 and severely restrict the use of cash. Also aim to persuade Nigerians to utilize the country’s recently released central bank digital currency (CBDC), known as Nara. The introduction of the CBDC last year met with slow customer uptake.

Nigeria And CBDCs

Adoption rates have been low since the debut of the eNaira on October 25, 2021. As of October 25, one year after its launch. According to some estimates, fewer than 0.5% of people have used the air. This suggests that it has been difficult for the Central Bank of Nigeria to convince its people to adopt the CBDC.

Nigeria adopted its “cash-less” policy in 2012 under the pretext that doing so would boost the effectiveness of its monetary policy. Reduce the cost of banking services, and raise the efficiency of its payment system.

According to a tracker made by the American think tank Atlantic Council. Nigeria is one of the 11 countries that has fully implemented a CBDC. India seems to begin its trial programs shortly after the other 15 countries.

Related Reading | New Prime Minister Rishi Sunak Expresses Support For Cryptocurrencies

Given the abundance of freely available decentralized alternatives. The general public will need more time to adopt a centralized digital currency. Even those better knowledgeable about cryptocurrency and blockchain technology show little enthusiasm.

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