By Praise Benjamin
This is a laudable move, as it promises to offer numerous advantages, such as lowering the inflation rate, regulating prices of goods, monitoring cash movement in various regions and so on. However, the downsides of this brilliant initiative have obviously not received adequate considerations from the government, and the common man is to bear the brunt.
In October, 2022, the CBN announced the redesign of the N200, N500 and N1000 notes as a mechanism for controlling ‘the flow of money’, among other benefits purportedly attached.
According to statistics, about 85% of the naira notes in circulation are sitting out of the vaults of commercial banks; this is another way of saying ‘Nigerians are holding too much cash’.
As a result, the monthly cash withdrawal limit for individuals has dropped from N500, 000 to N100,000 and that of corporate organisations has dropped to N500,000.
This promised to have overwhelming negative implications for POS merchants who will now be limited to a N20, 000 daily withdrawal quota and N100, 000 on a weekly basis.
CBN Governor, Godwin Emefiele
According to reports, this regulation has been reinstated to encourage more cashless transactions which the CBN believes are safer, as transactions can be easily traced from one account to another.
This policy speaks directly to the comfort of the common man or the absence of it; invariably, the policy is dysfunctional if it plunges the common man deeper into the abyss of economic distress. The former PDP National Publicity Secretary has described the policy as ‘counterproductive and inconveniencing’ to the poor.
Business owners whose tool of trade is physical cash are being set up for frustration resulting from the withdrawal limit.
Reacting to the development, an economic analyst wrote: “The effort of the CBN will not achieve its pivotal objective of monitoring the financial flow of a large number of transactions, if the current Naira Redesign initiative is not tied to the compulsory use of the e-Naira by all Nigerians”.
@layren11 wrote: “The CBN is discouraging us to save money in banks… They are making NIGERIA more difficult to live in.”
@nakodomi wrote: “It seems it’s all about those who transact in Naira so far. What about those who get the dollars from the CBN at an official or subsidized rate? Do they go scot free of all those taxes and restrictions as to how much they can spend?”
Expectedly, citizens are clearly unimpressed with this new policy. Nigerians have always been skeptical of ‘new developments’ in the economic sector, believing that the government merely make these restrictions to ‘punish’ poor masses.
Rather than leaving a lame man wondering in shambles, the governing bodies must learn to educate the general public on the ‘benefits’ of these regulations and constraints on the country’s economy. They should also proffer solutions to the problems that arise in the process.
Praise Benjamin writes for Eko Hot Blog. This media platform reserves all rights to this article.
Editor’s note: This article was written before the latest circular of the CBN revising the cash withdrawal limit.
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