The Voice Of The Masses

The Central Bank of Nigeria on Tuesday introduced a daily cash-out transaction limit of N100,000 per individual customer for Point-of-Sale agents (POS).

This is said to be part of new measures to advance the cashless policy in Nigeria.

The measures, according to the CBN also aim to address identified challenges in agent banking, prevent fraudulent activities, and promote the adoption of electronic payment channels.

The directive, contained in a circular dated December 17, 2024, is signed by Oladimeji Taiwo on behalf of the Director of the Payments System Management Department at the CBN, and addressed to Deposit Money Banks, Microfinance Banks, Mobile Money Operators, and Super-Agents, mandates immediate compliance by all stakeholders.

The circular outlined key measures to ensure uniform operational standards, combat fraud, and enhance the use of electronic payment systems in agency banking operations.

According to the directive, POS agents must ensure that individual customer withdrawals do not exceed N100,000 daily.

As agents are restricted to a cumulative cash-out limit of N1.2million per day, customers face a maximum cash withdrawal limit of N500,000 per week.

The circular read in part, “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 per week; Ensure that all agent banking terminals are set to a daily maximum transaction cash-out limit of N100,000 per customer; Ensure that each agent’s daily cumulative cash-out limit shall not exceed N1,200,000.”

To ensure accountability, the CBN has mandated that all agency banking transactions must be conducted exclusively through float accounts maintained with the principal institutions.

The apex bank also directed that agent banking services be separated from other merchant activities, with agents required to use the approved Agent Code 6010 for transactions.

Also, all agent banking terminals must be connected to the Payments Terminal Service Aggregator, and 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.

The circular emphasised that principals of agent banking operations must monitor accounts linked to agents’ Bank Verification Numbers to detect any unauthorised activities outside the designated float accounts.

It further reiterated that principals would be held fully responsible for the actions and omissions of their agents in relation to banking services.

To ensure compliance, the CBN announced plans to conduct periodic oversight and impromptu backend configuration checks.

Any breaches of the directive, the circular warned, would attract penalties, including monetary fines and administrative sanctions.

However, the policy is expected to impact POS operators and customers, particularly in areas with limited banking infrastructure. While the apex bank urged all stakeholders to adhere strictly to the directives to ensure the smooth implementation of the policy and contribute to the advancement of Nigeria’s cashless economy.

CBN had revealed that more than 94 per cent of the cash in circulation in the country is outside the control of deposit banks, marking a significant year-on-year increase of N1.59 trillion in the amount of currency held outside banks.

Data from the CBN’s money and credit statistics shows that a substantial proportion of currency in circulation remains outside the banking system, with more than 90 per cent consistently held outside formal financial institutions in 2024.

The data revealed that currency outside banks surged to N4.29trillion in October 2024, accounting for 94.3 per cent of the total currency in circulation of N4.55trillion.

This represents a significant year-on-year growth of 59 per cent or N1.59trillion from N2.70trillion in October 2023, when 89.6 per cent of the total currency was outside banks.

On a month-on-month basis, the amount held outside banks increased by 6.8 per cent or N270billion, compared to the N4.02trillion recorded in September 2024.