CBN places N100,000 daily PoS cash transaction limit for individuals, N500k per week

The Central Bank of Nigeria (CBN) has announced daily cash limit transactions of N100,000 per customer for Point-of-Sale (POS) agents. The announcement is part of the apex bank’s new initiative for Nigeria’s cashless policy advancement. 

Circulated in a statement signed by Oladimeji Taiwo on behalf of the Director of the Payments System Management Department at the CBN and dated December 17, 2024, it instructed all Deposit Money Banks, Microfinance Banks, Mobile Money Operators, Super-Agents, and all stakeholders to immediately comply to the by all directives.

The apex bank also outlined significant measures to ensure compliance and uniform operational standards, combat fraud, and enhance the use of electronic payment systems in agency banking operations.

Also, POS agents are to ensure that individual customer withdrawals do not exceed the N100,000 daily limit. They are also restricted to a cumulative cash-out limit of N1.2m per day, while customers face a maximum cash withdrawal limit of N500,000 per week.

“All principals of agents are to comply with the following directives immediately. Issuers shall set a cash withdrawal limit (cash-out) per customer (regardless of channel) to N500,000.00 per week; Ensure that all agent banking terminals are set to a daily maximum transaction cash-out limit of N100,000.00 per customer; Ensure that each agent’s daily cumulative cash-out limit shall not exceed N1,200,000.00,” part of the statement reads. 

In addition, CBN mandated that all agency banking operations must be solely carried out through float accounts maintained with the principal institutions. It stressed that the goal of the new measures is to address identified challenges in agent banking, enable the adoption of electronic payment channels, and prevent fraudulent activities.

CBN’s strategies for compliance

The apex bank directed all agents to use the approved Agent Code 6010 for transactions while agent banking services were separated from other merchant activities. CBN emphasized that principals of agent banking operations must monitor accounts linked to agents’ Bank Verification Numbers to detect any unauthorized activities outside the designated float accounts.

It pointed out that to ensure strict adherence to the regulation, banking terminals must be connected to the Payments Terminal Service Aggregator. In the same light, daily transaction reports including withdrawal limits and float account balances must be electronically submitted to the Nigerian Inter-Bank Settlement System using a reporting template provided by the CBN.

In line with compliance, CBN announced plans to embark on timely monitoring and impromptu backend configuration checks. Furthermore, it warned that agencies would be held fully responsible for the actions and omissions of their agents in relation to banking services. Any breaches of the directive, according to the apex bank, would attract penalties such as monetary fines and administrative sanctions.

CBN, in its conclusion, encouraged all stakeholders to adhere strictly to the directives in order to ensure the smooth implementation of the policy and contribute to the advancement of the cashless policy in the Nigerian economy.

The latest measure is coming amidst a period where Nigerians are facing difficulties as regards scarcity of cash, perhaps within the holidays. However, the policy is expected to impact POS operators and customers, particularly in areas with limited banking infrastructure. Regardless, a serious cash shortage across the country is compounding the hardship faced by Nigerians who have endured an inflationary wave over the past few months.

The CBN claimed on Monday that over N3.3 trillion is in circulation as of December, compared to just N1 trillion in early 2023. This implies that the cash in supply should theoretically meet public demand. Another report explained that the currency outside banks grew to N4.29 trillion in October, representing 94.3 per cent of the total currency in circulation of N4.55 trillion.

Although the CBN has threatened to sanction banks that fail to make cash available over the counter or at ATMs, much of the cash is still being hoarded by individuals thereby causing its scarcity.

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