Central Bank of Nigeria Exempts Microfinance and Primary Mortgage Banks from Cash Withdrawal Limits
The Central Bank of Nigeria (CBN) has issued a circular exempting Primary Mortgage Banks and Microfinance Banks that provide banking services to the economically active poor from the cash withdrawal limits. The circular was signed by the Director of the Payment System Management Department, Musa Jimoh, and released on Monday to banks and other financial institutions.
The directive aims to enable microfinance banks and primary mortgage banks to continue their vital roles in the economy and offer specialized retail banking services to their customers. As part of the exemption, these banks will no longer be required to pay processing fees for withdrawals exceeding the cash withdrawal limits from their corresponding banks.
The circular emphasizes that while exempted from cash withdrawal limits processing fees, microfinance and primary mortgage banks must still fully comply with the cash withdrawal limits for serving their customers, as stated in a previous circular issued on December 21, 2022.
Opinion:
The exemption of Microfinance Banks and Primary Mortgage Banks from cash withdrawal limits is a positive step by the Central Bank of Nigeria. By allowing these banks to provide specialized retail banking services without additional processing fees, they can better serve the economically active poor and contribute to the growth of the economy. This move is likely to encourage financial inclusion and support the development of the underserved sectors of the population. However, it will be essential for these banks to adhere to the cash withdrawal limits and maintain compliance with the regulations to ensure transparency and accountability in their operations.
