What Changed In CBN’s Cash Policy, Why Nigerians Should Care

By Enam Obiosio

The Central Bank of Nigeria (CBN) has introduced sweeping revisions to its cash-related rules, removing limits on cash deposits and expanding the weekly withdrawal ceiling to N500,000 for individuals. The changes, announced through new regulatory circulars, represent one of the most significant shifts in Nigeria’s cash-management framework in recent years.

The announcement came through a circular titled ‘Revised Cash-Related Policies’ signed by Dr. Rita Sike, Director of the Financial Policy and Regulation Department at the CBN. The bank also referenced an earlier circular issued in October and signed by Musa Jimoh, Director of the Payments System Policy Department at CBN, which introduced tighter controls on PoS agents.

The new rules, which take effect on January 1, 2026, are part of the apex bank’s broader effort to cut the high cost of managing physical cash, reduce security vulnerabilities, and curb money-laundering risks in an economy still heavily dependent on cash.

The CBN officially removed all limits on cash deposits and increased the weekly withdrawal limit for individuals to N500,000, up from N100,000. Corporate bodies can now withdraw up to N5 million weekly.

Other key changes include:

• Excess withdrawal fees of three percent for individuals and five percent for corporates when limits are exceeded.
• Daily ATM withdrawals capped at N100,000, with a weekly maximum of N500,000.
• Discontinuation of the special monthly authorisation that once allowed N5 million (individuals) and N10 million (corporates) withdrawals.
• Permission for banks to load all currency denominations into ATMs.
• Over-the-counter third-party cheque encashment remains limited to N100,000.
• Deposit Money Banks must submit monthly reports on cash deposits and withdrawals above the limits.
• Government revenue-generating accounts are exempt, but exemptions for embassies, diplomatic missions, and donor agencies have been withdrawn.

These updates build on an earlier directive signed by Musa Jimoh, which required banks to report PoS activity in detail and capped PoS agent transactions at N1.2 million daily, while customer transactions were capped at N100,000 per day.

Why It Happened

According to Dr. Rita Sike, the policy overhaul is meant to modernise Nigeria’s cash-management system and address the challenges of rising operational costs, security risks, and money-laundering vulnerabilities.

The CBN noted that many past cash-related policies were introduced at different times, responding to different conditions. With economic realities now changing, the apex bank believes it is time to streamline and harmonise these measures.

Analysts say the cost of transporting, securing, and processing cash has soared, with banks often passing these expenses to customers. The CBN wants to reduce these costs, protect consumers, and slow down the excessive use of cash that undermines the cashless policy project.

Who Benefits?

Banks: Lower operational costs, improved security, better oversight of large cash movements, and clearer reporting requirements.

Digital Payments Providers: Higher incentives for consumers to switch to electronic transactions, especially as excess withdrawal fees kick in.

Government Agencies: Federal, state, and local government revenue accounts are exempt from the withdrawal limits, allowing smoother operations.

Everyday Nigerians Who Use Moderate Cash: Removal of deposit limits makes banking easier, and the higher weekly withdrawal cap gives flexibility to individuals and households.

Who Loses

Cash-heavy businesses: Those relying on very large cash withdrawals will now pay steep excess fees.

PoS Merchants:Under the rules signed by Musa Jimoh, they now face tighter controls, daily caps, and mandatory reporting, which may affect income and operations.

Embassies, international NGOs, and donor agencies: Previous exemptions have been revoked, meaning they must now comply fully with the new limits and charges.

Money launderers and informal high-volume cash movers: Greater scrutiny, lower thresholds, and mandatory reporting make illicit cash movement far riskier.

What the Numbers Truly Mean

The revised thresholds signal a balance between flexibility for ordinary citizens and tighter control over high-value cash activity.

• The N500,000 weekly withdrawal allowance is significantly higher than before but still discourages excessive cash dependency.
• The 3 percent and 5 percent excess withdrawal charges are intentionally high to deter large withdrawals.
• The N100,000 daily ATM cap reinforces the move toward digital channels for sizable transactions.
• The N1.2 million PoS cap prevents the use of PoS terminals as unregulated cash hubs.
• Removing the N5m/N10m special authorisation blocks a major loophole that previously allowed huge cash movements outside everyday reporting systems.

Together, the numbers show a policy that loosens the reins for ordinary users but tightens them significantly for higher-risk cash flows.

What to Expect Next

• Increased regulatory monitoring, especially for banks and PoS operators.
• A shift toward digital payments, as individuals and businesses try to avoid excess fees.
• More discussions on banking charges, since banks must warehouse excess withdrawal fees separately.
• Operational adjustments in cash-dependent sectors, such as wholesale markets and logistics.
• Stronger collaboration between CBN, SEC, EFCC, and banks on financial integrity measures.
• Possible further refinements, depending on how the policy performs after implementation.

Nigeria’s cash economy is entering a new stage. With Dr. Rita Sike and Musa Jimoh driving policy harmonisation and oversight, the CBN is signalling that while cash remains part of the system, it will no longer operate without deeper scrutiny, transparency, and cost discipline.

This is not just a policy change; it is a restructuring of how physical money will function in Nigeria’s financial future.