Senate to debate policy on Tuesday, NECA says it is draconian
By Emma Ogbuehi
The Senate has raised concerns about the latest Central Bank of Nigeria (CBN) policy on cash withdrawals. In consequence, the chamber has scheduled Tuesday next week to debate the policy.
This is as the Nigeria Employers’ Consultative Association, NECA, also expressed concerns over the new CBN directive, saying there is “no gainsaying that the livelihood of many individuals and enterprise sustainability would be impacted.”
Reacting to the new policy, Director-General of NECA’s Wale-Smatt Oyerinde, said “As usual with the Central Bank of Nigeria (CBN), the Bank announced a new naira withdrawal policy without extensive consultation with Organized businesses and those that will be directly impacted by the Policy. This new policy is diversionary and a mere distraction from the critical issues that are affecting the Nation. With the inflation rate hovering around 20 percent and over 100 million Nigerians in multidimensional poverty, the best that Government should do is not to further cripple the economic activities of Nigerians. It is no gainsaying that the livelihood of many individuals and enterprise sustainability would be impacted.
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“While it is desirable to get all bankable individuals and businesses into the banking system and promote the cashless policy of the CBN, the timing without adequate preparation and sensitization of the critical mass that drives the economy (the SMEs and MSMEs) could prove counter-productive and further drive many below the poverty line. This is another classical example of the inconsistencies and misalignments between the fiscal and monetary policies of the Government. It is absurd to blatantly set traps of processing fees for individuals and businesses who desire to withdraw their hard-earned money from the bank for legitimate and genuine business transactions. It is also important to note that the banking infrastructure and mobile/digital facility to drive the cashless policy are not sufficiently developed. This is not only draconian but also inhuman”.
Senate Minority Leader Phillip Aduda in a point of order during plenary on Wednesday called the attention of his colleagues to the new policy and demanded for caution as it will affect many Nigerians, especially small business owners.
In his response, Senate President Ahmad Lawan cautioned the CBN not to approach the policy by jumping into it at once as many Nigerians will be affected.
He further noted that there is a need to engage the CBN in discussions to get more details of the policy. He directed the committee on banking to discuss the matter during the screening of the CBN Deputy Governors expected to hold before next week.
Under the new withdrawal policy, the CBN restricted the maximum cash withdrawal over the counter (OTC) by individuals and corporate organisations per week to N100,000 and N500,000 respectively.
The CBN stated, however, that withdrawals above the thresholds would attract processing fees of 5 per cent and 10 per cent respectively for individuals and corporate entities going forward.
In addition, third-party cheques above N50,000 shall not be eligible for OTC payment while extant limits of N10 million on clearing cheques still remain.
The new withdrawal regime further pegged the maximum cash withdrawal per week via Automated teller Machine (ATM) at N100,000 subject to a maximum of N20,000 cash withdrawal per day.