CBN caps PoS withdrawals: Cash is no longer king

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December 19, 2024
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5 min read
CBN building

Shalom,

Delight from Techpoint here,

Here's what I've got for you today:

  • CBN caps PoS withdrawals: Cash is no longer king
  • SEC wants full financial access
  • Dollar ban bill: Will it save the naira?

CBN caps PoS withdrawals: Cash is no longer king

PoS

The Central Bank of Nigeria (CBN) just dropped some new rules on cash withdrawals through Point-of-Sale (PoS) terminals, and it’s stirring up conversation.

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Here’s the gist: the move is all about cutting down the amount of physical cash floating around and pushing more people towards digital payments like mobile banking, internet transfers, and card payments.

So, what’s the deal with the limits? For individuals, you can only pull out a maximum of ₦20,000 per day or ₦100,000 a week via PoS. Businesses get a bit more wiggle room, with a ₦500,000 weekly limit.

For agents (the middlemen who process transactions for others), it’s a much higher daily limit — ₦1.2 million — but they’ve got stricter rules to follow. They’ll need to use a special agent code (6010) for all transactions and report their daily activities to the Nigerian Inter-bank Settlement System (NIBSS) through the Payments Terminal Service Aggregator (PTSA).

But here’s the kicker: if anyone — individuals or businesses — exceeds these limits, there’s a processing fee. For individuals, it’s a 5% charge; for businesses, it jumps to 10%.

On paper, this policy is supposed to streamline record-keeping and make cash handling safer, but it’s likely to hit rural communities and small businesses hard. Many of these areas still lack reliable digital infrastructure or the financial know-how to navigate this new system.

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This isn’t CBN’s first move to curb cash. Back in February 2024, they also banned banks from making cash payments for Personal Travel Allowance (PTA) and Business Travel Allowance (BTA).

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While the intention might be to modernise the financial system, it’s clear there are some hurdles ahead — especially in places where cash is still king.


SEC wants full financial access

Securities and Exchange-Commission

The Nigerian Securities and Exchange Commission (SEC) has issued a new rule that could shake things up for companies listed on the stock exchange. 

Starting January 2025, all quoted companies must publish their financial statements on their official websites.

Why the sudden push? It’s all about transparency, accountability, and giving investors the confidence they need. When companies keep their financial performance out in the open — think quarterly, semi-annual, and annual reports — it helps everyone make smarter investment decisions.

Here’s the backstory: the SEC has noticed that some companies aren’t updating their websites with the latest financial info. This leaves investors guessing about the company’s financial health and violates sections 39 and 40 of SEC’s rules. Not exactly a good look.

Under this directive, companies are expected to make their financial reports easily accessible to the public after filing them with regulators. This isn’t just about ticking boxes; it’s a step toward better corporate governance and boosting trust in Nigeria’s capital market.

But the SEC isn’t messing around. Companies that fail to comply could face serious consequences — anything from fines to suspension from trading, or even getting delisted from the Nigerian Exchange.

For investors, this move is a win. Having easy access to up-to-date financial data means they can make better decisions and avoid nasty surprises. And for companies, it’s a wake-up call to step up their game and show they have nothing to hide.

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Dollar ban bill: Will it save the naira?

smartphone resting on dollar bill
Image by Kris from Pixabay

Imagine landing a sweet gig that pays in dollars in Nigeria, only to hear the government wants to ban foreign currency payments in Nigeria. Yeah, that’s the scenario brewing right now as the Nigerian Senate just moved a step closer to making it a reality.

They’ve passed the first reading of a bill that could outlaw using foreign currencies, like the US dollar, for any transactions within the country. The bill, titled “A Bill for an Act to Alter the Central Bank of Nigeria Act, 2007, No. 7, to Prohibit the Use of Foreign Currencies for Remuneration and for Other Related Matters,” is essentially pushing for an all-naira system.

If this goes through, salaries — even those for expatriates — must be paid in naira. The idea is that this will ease the demand for foreign exchange, strengthen the naira, and stabilise the economy.

The bill was introduced by Senator Ned Nwoko, who’s also the Chairman of the Senate Committee on Reparations and Repatriation. According to him, too many businesses and wealthy individuals are obsessed with dollar transactions, a practice he calls a "colonial hangover." He argues it’s partly to blame for the naira’s struggles and Nigeria’s ongoing economic headaches.

Sure, it sounds like a patriotic move to save the naira, but not everyone’s on board. Critics are questioning how realistic this is, especially for businesses that rely on foreign currencies for imports and exports. Then there’s the potential backlash from regular folks — because let’s be real, many Nigerians see dollar earnings as a lifeline in an economy where the naira keeps losing value.

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So, what’s next? The coming months will determine if this bill actually becomes law or fizzles out like so many others. Either way, it’s got everyone’s attention, and the debate over its impact on Nigeria’s economy and citizens is only just beginning.


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Have a terrific Thursday!

Sunny Delight for Techpoint Africa.

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