Why CBN may continue with cash withdrawal limit policy

The Central Bank of Nigeria (CBN) may go ahead with implementing its cash withdrawal limit policy despite the ruling of the Supreme Court on Friday, March 3, 2023.

The apex court in its judgement reversed CBN’s deadline for using the old N200, N500, and N1000 notes as legal tender and set a new date of December 31, 2023.

But the recent Supreme Court ruling did not affect the apex bank’s cash withdrawal limit, which it says is meant to reduce cash in circulation.

In December 2022, CBN mandated deposit money banks and other financial institutions to limit over-the-counter withdrawals to N100,000 weekly for individuals and N500,000 for corporate bodies, respectively.

The circular containing the cash withdrawal limit stated that the policy became effective on January 9, 2023.

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The CBN reviewed the policy in January and increased weekly withdrawals for individuals to N500,000 and N5 million for corporate bodies.

There was no mention of this during the Supreme Court judgment of Friday.

In a unanimous judgment, the Supreme Court criticized President Muhammdu Buhari’s approval of the policy as unconstitutional and a breach of the fundamental rights of Nigerians.

Justice Agim held that Buhari acted without consulting relevant bodies and agencies of government before directing the CBN to introduce the new naira notes unlawfully.

Agim said Buhari’s unconstitutional use of powers in redesigning the naira had breached the rights of Nigerians in many ways.

Irrespective of the ruling, CBN might still implement the cash withdrawal limit as the Supreme Court judgment was silent on it.

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