The Central Bank of Nigeria (CBN) has exempted microfinance banks (MFBs) and primary mortgage banks (PMBs) from paying processing fees for withdrawals above the cash withdrawal limits. This decision is aimed at enabling them to continue their role in the economy and provide specialized retail banking services to their customers.
In December 2022, the CBN set cash withdrawal limits for individuals and corporate entities to N100,000 and N500,000 per week, respectively. Due to mixed reactions from Nigerians, the apex bank later increased the limits to N500,000 and N5 million, respectively, while implementing a processing fee of 3 percent and 5 percent for individual and corporate withdrawals above the specified limit.
The cash withdrawal policy, which aims to promote the cashless policy and reduce cash outside the banking system, took effect on January 9, 2023. The recent exemption granted to MFBs and PMBs allows them to provide essential services to the economically active poor without incurring the processing fees for withdrawals above the set limits.