Idris Ahmed
29 December 2011
The Central Bank of Nigeria (CBN) has barred banks operating in Lagos State from involving in cash in transit lodgement services rendered to merchant or customers in Lagos from December 31 as the pilot scheme for cashless economy commences in Lagos from January 1, 2012. Cash-in-transit (CIT) is a term used to refer to the physical transfer of banknotes, coins and items of value from one location to another.
“Only CIT licensed companies shall be allowed to provide cash pick-up services. Any bank that continues to offer cash in transit lodgement services to merchants shall be sanctioned accordingly,” the CBN said in a circular titled “Modalities on implementation of cash policy for cash-less Lagos.”
The entire country would become cashless economy by July next year, according to the central bank. It said the aim was to ensure security.
According to the guidelines for the cashless economy, an individual is only allowed to withdraw or make a cash lodgement of N150, 000 per day, while corporate entities can withdraw and lodge only N1 million. Any additional amount would be charged.
It also said that third party cheques above N150, 000 shall not be eligible for encashment over the counter. It said value for such cheques shall be received through the clearing house.
The CBN further explained that the service charges/fees will not apply until March 30th, 2012, “in order to give people time to migrate to electronic channels and experience the infrastructure that has been put in place.
“Therefore, banks should continue to encourage their customers to migrate to available electronic channels, and where possible demonstrate the costs that will accrue to those that continue to transact high volumes of cash after March 31st in Lagos.”
The circular issued by the CBN’s Director, Currency Operations Department, Mahmoud K. Umar said the limits on cash are cumulative daily limits each for withdrawal, and for deposits.
“The limits apply to the account so far as it involves cash, irrespective of channel (e.g. over the counter, ATM, 3rd party cheques encashed over the counter, etc) in which cash is withdrawn or deposited (e.g. if an individual withdraws N50,000 over the counter, and N150,000 from the ATM on the same day, the total amount withdrawn by the customer is N200,000, and the service charge will apply on N150,000 – the amount above the daily limit),” it said.
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