CBN revamps cash policy to curb costs and streamline banking operations
The Central Bank of Nigeria (CBN) has announced major revisions to its cash-related policies, effective January 1, 2026. The central bank has completely removed the cumulative limit on cash deposits and significantly raised the weekly cash withdrawal threshold across all banking channels.
The new measures are part of an ongoing effort to address the escalating cost of cash management, enhance security, and mitigate money laundering risks associated with the country’s historic heavy reliance on physical currency.
These comprehensive revisions were disclosed in a new circular titled “Revised Cash-Related Policies,” sent to all commercial banks and signed by Dr. Rita Sike, Director of the Financial Policy & Regulation Department. The CBN explained that while previous policies aimed at reducing cash usage and promoting electronic payments were necessary, the need arose to streamline and update these provisions to reflect current economic realities. The changes introduce a new structure for withdrawals and remove all prior limits on deposits.
Key changes to deposit and withdrawal limits
One of the most significant changes is the complete removal of the cumulative deposit limit. As a result, the fee previously charged on all excess deposits will no longer be applicable from the effective date. This is expected to offer a major relief to businesses and individuals who transact large volumes of cash.
The CBN has substantially reviewed the cumulative weekly withdrawal limit across all channels, including over-the-counter and Point-of-Sale (PoS) transactions. The new limit for individuals has been raised to ₦500,000, a major increase from the previous ₦100,000 limit. For corporate customers, the weekly limit has been set at ₦5 million, up from the previous cap. The special monthly authorization that allowed high-net-worth individuals to withdraw ₦5 million and corporate entities ₦10 million once a month has been abolished under the new policy.
New charges and guidelines for automated teller machines
Withdrawals exceeding these new cumulative weekly thresholds will attract an excess withdrawal charge, which the central bank has clearly specified. Individuals exceeding their weekly limit will be charged 3 per cent on the excess amount, while corporate customers will face a 5 per cent charge. These excess withdrawal charges will be shared between the central bank and the operating bank in a ratio of 40 per cent to the CBN and 60 per cent to the operating bank or financial institution.
Regarding Automated Teller Machines (ATMs), the daily withdrawal limit remains capped at ₦100,000 per customer. However, the maximum weekly ATM withdrawal is now ₦500,000, which must be accounted for as part of the overall weekly withdrawal limit applicable to all channels. Banks have also been instructed to load all currency denominations in their ATMs to improve service delivery and reduce reliance on lower denominations.
Exemptions and reporting requirements
The CBN maintained the existing limit on the over-the-counter encashment of third-party cheques, which remains pegged at ₦100,000. These third-party cheque withdrawals will also be counted as part of the overall cumulative weekly limit imposed on individual and corporate accounts. The new circular mandates banks to render monthly returns to the relevant CBN supervisory departments, including the Banking Supervision Department, the Other Financial Institutions Supervision Department, and the Payments System Supervision Department.
The apex bank clarified that certain accounts are exempted from the new withdrawal and excess-fee rules. These exemptions apply to revenue-generating accounts of federal, state, and local governments, as well as the accounts of microfinance banks and primary mortgage banks held with commercial and non-interest banks. Notably, the long-standing exemption previously enjoyed by embassies, diplomatic missions, and aid-donor agencies has been removed, subjecting them to the new withdrawal and fee structure.
