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    Friday, March 30, 2012

    CBN Exempts Embassies, Int’l Bodies From Cash Limit Policy



    Central Bank of Nigeria exempted all specialized international institutions from penalties on withdrawal and deposit limits under the cash-less policy, which will begin in a few days’ time. A circular by the apex bank signed by the Acting Director, Banking and Payments System Department, Mr. Gaius Emokpae, listed the specialised international institutions as embassies, diplomatic missions, as well as 
    multilateral and aid donor agencies.
    The statement read in part, “Nigeria is a signatory to several treaties, which exempt institutions from all fees and charges in the host country. As a matter of international practice, sovereign states do not impose financial penalties on other sovereign states; it has become necessary, therefore, to extend the exemption on cash withdrawal/deposit to these institutions. “The CBN hereby exempts all embassies, diplomatic missions and multilateral and aid donor agencies in Nigeria from penalties and charges on cash withdrawal and deposits with regards to the cash-less Nigeria project.” The CBN had earlier waived penalties on the cash limit for primary mortgage institutions and microfinance banks.
    It explained in a statement that the waiver was due to the nature of their business. The apex bank said, “It has come to our notice that some Deposit Money Banks apply cash withdrawal/deposit limits for corporate organisations to PMIs and MFBs. PMIs and MFBs are specialised banks under the new 
    banking model, which have customers that maintain savings demand and time deposit accounts with them.
    “As deposit-taking institutions, they are obliged to honour the withdrawal  requests of their customers and other deposit obligations. It is imperative to note that the aggregate withdrawal by the depositors of MFBs and PMIs per day could exceed N1m. Thus, necessitating those institutions to withdraw over N1m from their correspondent banks in order to service their customers.”
    The CBN recently deferred the take-off date for the cash-less banking initiative in other states apart from Lagos till January 1, 2013. It also extended the implementation of the pilot scheme in Lagos State from 
    March 31 to December 31, 2012. It, however, said that the implementation of the newly approved processing charges by the banks in Lagos State would commence on April 1, 2012, adding that the charges were subject to review every six months.
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