CBN reintroduces charges on cash deposits, withdrawals

The Central Bank of Nigeria on Thursday announced the reintroduction of bank charges on certain categories of cash deposits and withdrawals, three years after it stopped the charges.

The reintroduction of the charges was contained in a circular to all Deposit Money Banks posted on the website of the CBN.

The apex bank in the country said the decision to reintroduce the charges on cash deposits was part of the review of charges on deposits and withdrawals under the cashless policy.

The decision, the CBN said, was taken at the Bankers’ Committee meeting, which held in Abuja two weeks ago.

The circular was signed by the Director, Banking and Payments System Department, CBN, Dipo Fatokun.

The circular said the committee decided that the cashless policy should be extended to the remaining 30 states of the federation.

Only six states have been operating the cashless policy before now.

These are the Federal Capital Territory, Lagos, Ogun, Anambra, Abia, Kano and Rivers States.

The CBN also directed that with effect from April 1, 2017, banks in the states where the cashless policy was already operating would begin to impose charges on deposits and withdrawals above N500,000.

Banks will from that date begin to charge individuals 1.5 per cent and two per cent for deposits and withdrawals between N500,000 and N1 million.

The circular said individuals depositing or withdrawing between N1 million and N5 million will be charged two per cent and three per cent respectively.

Any amount above N5 million will for an individual attract three per cent and 7.5 per cent for deposits and withdrawals respectively.

For companies, deposits and withdrawals under N3 million would not attract any charge, but that such customers depositing or withdrawing between N3 million and N10 million would be charged two per cent and five per cent respectively.

Also for deposits and withdrawals between N10 million and N40 million, customers will be charged three per cent and 7.5 per cent respectively.

Deposits or withdrawals above N40 million by corporate customers will attract a charge of five per cent and 10 per cent respectively.

According to the CBN, the new policy on charges will be implemented in selected states on May 1 and August 1, while the total implementation will become effective on October 1.

The regulator noted that the committee agreed that income generated from the processing fees above the allowable cash limits would be shared between it and the banks in the ratio of 40:60.

However, the CBN said that existing exemptions to the policy such as revenue generating agencies of the federal, state and local governments (for lodgments) will be sustained.

Also exempted from the processing fees are embassies, diplomatic missions, multilateral and aid agencies.

The CBN directed lenders to train their employees to enlighten customers on the new policy.