CBN Tweaks Cash Deposit Policy to Curb Costs, Security Risks, Money Laundering

•Abolishes deposit limits, increases weekly withdrawal threshold to N500,000 for individuals, N5m for corporates

•Declares fee for excess deposit, exemption of embassies, diplomatic missions, aid-donor agencies from specific cash policies shall no longer apply

•Exempts revenue generating accounts of federal, state, local governments, others

•Apex bank moves against authorised push payment fraud, orders 14-day resolution in new draft policy

James Emejo in Abuja and Nume Ekeghe in Lagos

The Central Bank of Nigeria (CBN), yesterday announced the removal of all limits on cash deposits, and raised the weekly cash withdrawal limit across all channels to N500,000 from N100,000 for individuals, and N5 million for corporates.

The revised policy, effective from January 1, 2026, was contained in a CBN circular issued to all banks, other financial institutions and the public, titled, “Revised Cash-Related Policies”, which was signed by Director, Financial Policy and Regulation Department, Dr. Rita Sike.

The central bank further declared that effective January, cumulative deposit limit would be removed while fee for excess deposit shall no longer apply, adding that exemption of embassies, diplomatic missions and aid-donor agencies from specific cash policies had been abolished.

In a separate development, the CBN also issued draft guidelines for addressing Authorised Push Payment (APP) fraud, mandating a 14-day resolution period for customer complaints, including a 48-hour window for reimbursement.

The review of cash deposit thresholds is part of efforts by the apex financial regulatory institution to moderate the rising cost of cash management, address security concerns, and reduce money potential money laundering associated with the economy’s heavy reliance on cash.

The central bank pointed out that the cash deposit policies imposed over the years were in response to evolving circumstances in cash management, aimed at reducing cash usage and encouraging accelerated adoption of other payment options, particularly electronic payment channels.

However, the apex bank stated that with the effluxion of time, the need had arisen to streamline the provisions of these policies to reflect present-day realities.

The circular further stated that the special authorisation for withdrawal of N5 million and N10 million once monthly by individuals and corporates, respectively, shall no longer apply.

The revised circular also stated that Automated Teller Machine (ATM) withdrawal limit shall be N100,000 daily (per customer), subject to a maximum of N500,000 weekly, adding that cash withdrawals from ATMs and point of sale devices are part of the weekly withdrawal limit indicated therein.

The CBN also stated that excess cash withdrawal shall attract fees of three per cent and five per cent to individual and corporate customers, respectively, on the excess amount withdrawn.

The bank added that the fee shall be shared 40 per cent to the CBN and 60 per cent to the bank or financial institution.

In addition, the apex bank retained the limit on over-the-counter encashment of third-party cheques at ¥100,000, noting that any withdrawal under this section would form part of the cumulative weekly access to cash by account holders.

The circular further mandated that banks render monthly returns on cash withdrawal transactions above the specified limit as well as returns on cash deposits to the respective supervisory departments (Banking Supervision Department, Other Financial Institutions Supervision Department and Payments System Supervision Department) of the CBN as applicable.

The CBN stated that Deposit Money Banks (DMBs) shall create separate accounts to warehouse processing charges collected on cash withdrawals above the limits.

The central bank, however, exempted revenue generating accounts of federal, state, and local governments as well as accounts of microfinance banks and primary mortgage banks with commercial and non-interest banks from the application of the revised cumulative weekly withdrawal limit and exceptional authorisation for cash withdrawal.

However, the CBN pointed out that once the APP guideliness, also signed by Sike, the guidelines are finalised, banks and other financial institutions will be compelled to adopt preventive measures and establish clear modalities for mitigating and managing APP fraud.

The draft stipulates that banks and Other Financial Institutions (OFIs) must provide reporting mechanisms enabling customers to lodge APP fraud complaints within 72 hours via designated channels such as hotlines, email, mobile applications, or in-person at branches.

It stated further: “The CBN in furtherance of its mandate of promoting a sound financial system in Nigeria, hereby exposes this draft Guidelines aimed at addressing the rising incidence of Authorised Push Payment fraud in the financial system for comments.

“When finalised, the Guidelines would mandate all financial institutions to institute preventive measures as well as modalities for mitigating and managing APP fraud.”

Banks, other financial institutions, public interest organisations, and the public are invited to submit their comments on the draft Guidelines in softcopy to not later than three weeks from the date of this circular.

It added: “Any customer who is a victim of APP fraud is expected to, within 24 hours of the occurrence, report the incident to their financial institution using the designated channels. Notwithstanding this expectation, customers shall have up to an additional 48 hours to make such a report.

“Where a customer fails to report an APP fraud incident within 72 hours of occurrence, and without reasonable justification, the financial institution may not be obligated to provide reimbursement, except where internal control failures or staff negligence contributed to the fraud.”

Banks and OFIs are required to initiate investigations immediately upon receiving a report, acknowledge receipt within 24 hours, and issue a unique case reference number alongside a summary of the review process.

“The full investigation shall be concluded within 14 working days, after which a clear decision shall be communicated to the customer. “Financial institutions shall clearly communicate the outcome of the APP fraud investigations to the customer stating if reimbursement is approved or denied.

“Where the reimbursement is denied, financial institutions shall provide reasons to the customer for such denial.”

The draft further empowers the CBN to direct the Nigeria Inter-Bank Settlement System (NIBSS) or other relevant entities to withhold settlement for the full value of fraudulent transactions, extending this measure to secondary or subsequent beneficiary institutions along the transaction chain.

Reimbursement obligations, however, exclude cases where customers acted fraudulently, negligently, or failed to report incidents within the stipulated 72-hour window.

Exceptions may apply in circumstances beyond the customer’s control, including illness, force majeure, delayed awareness of the fraud, security constraints, or demonstrable unavailability of reporting channels.

It added: “Failure to initiate or conclude the investigation within the stipulated timelines without reasonable justification may constitute a breach of consumer protection obligations and attract appropriate regulatory sanctions.”