Enforcement of N150, 000 Ceiling on 3rd Party Cheques Begins Monday

Naira notes

By Festus Akanbi

The ongoing cashless policy of the Central Bank of Nigeria (CBN) enters a new phase tomorrow when the maximum ceiling of N150, 000 placed on third party cheques that can be withdrawn by individuals takes off.

The implication is that any cheque above N150, 000 and which originated from a third party must as from tomorrow be lodged into the drawee’s account.

The policy, according to the CBN is one of the strings of measures being put in place to discourage the use of cash in the system.

Consequently, some money deposit banks were last week busy sending text messages to their customers to intimate them of the regulatory policy.

A message sent to a bank customer by one of the money deposit banks reads: “Dear Customer, kindly note that from June 1, 2013, 3rd party cheques over N150, 000 cannot be cashed over the counter but should be lodged into your account.

Meanwhile, the CBN has extended the coverage of the cashless policy to the Federal Capital Territory, and five states including Kano, Rivers, Abia, Ogun and Anambra as from July 1.

Consequently, the apex bank has directed branches of money deposit banks in the affected states to begin an enlightenment of their customers on cashless policy, including the existing limit of cash withdrawals and deposits for individuals and corporate bodies as well as available e-payment options.

The CBN also stated in a circular conveying the instruction that money deposit banks should embark on training of staff on cashless policy, in order to provide answers to enquiries and handle issues/customers complaints, as well as provide advice on the policy. Media communications by banks to complement existing CBN and Bankers Committee media campaign.

The circular warned that the cashless policy implementation team will perform spot checks on bank branches in phase two locations to ensure readiness and compliance.

The CBN introduced a new policy on cash-based transactions which stipulates a ‘cash handling charge’ on daily cash withdrawals or cash deposits that exceed N500, 000 for individuals and N3, 000,000 for corporate bodies.

The new policy on cash-based transactions (withdrawals & deposits) in banks, aims at reducing the amount of physical cash (coins and notes) circulating in the economy, and encouraging more electronic-based transactions (payments for goods, services, transfers, etc.)

The new cash policy was introduced for a number of key reasons, including: To drive development and modernisation of the nation’s payment system in line with Nigeria’s vision 2020 goal of being amongst the top 20 economies by the year 2020; To reduce the cost of banking services (including cost of credit) and drive financial inclusion by providing more efficient transaction options and greater reach. The policy was also expected to improve the effectiveness of monetary policy in managing inflation and driving economic growth.