CBN exempts microfinance banks from Cashless program

CBN exempts microfinance banks from Cashless program

February 2, 2012

The Central Bank of Nigeria (CBN) has exempted microfinance banks from participating in cash-lite banking system. By this, the customers of the 898 microfinance institutions can now continue to deposit and withdraw above the apex bank’s limit.

Confirming the development, the Chairman, National Association of Microfinance Banks (NAMB), Lagos State Chapter, Mr Olufemi Babajide, said the apex bank has exempted the microfinance banks from participating in the cashless banking.

He said: "Microfinance banks nationwide have been exempted from taking part in the cashless banking programme. Based on this, the customers of the banks are free to withdraw and deposit money beyond the CBN’s limit. Already, customers of the banks have not been able to embrace the electronic banking payment such as Automated Teller Machines (ATMs) transactions. This made the customers to rely on cash for transactions. So, the implementation of the cash-lite programme will set the banking sub-sector aback."

He said the banks have been persuading customers to pay in cheques and do other banking transactions electronically, but to no avail.

"Of course, we have been appealing to customers to pay with cheques and withdraw from ATM points with the aim to operate a cashless banking, but this is not going to be immediate. The reason is because there is high level of illiteracy in the sub sector. Many of the customers are not educated. They do not even know what the cash-lite programme is all about, talk less of knowing how to conduct transactions through the electronic channels. It will take some time before MfBs can join the cashless banking initiative.

‘’The high illiteracy level in the subsector make it difficult for cashless banking policy to work, with customers unwilling to buy into this initiative," he added.

CBN had earlier pegged cash withdrawal and lodgement limits by individuals at N150, 000 and N1million for corporate bodies, as its implementation started within the Lagos metropolis earlier in the year.

Virtually, all banks in the state implement the cashless banking policy to the letter. In fact, the banks, from March, charge individual account holders and corporate organisations that violate the rules. While individuals that withdraw above N150,000 across the counters will pay a penalty of N100 for every N1,000 transaction, the corporate bodies will pay N200 for every N1,000.

Source: Nation


Tags

Comment With Your Facebook or Yahoo! ID

Login /Register to post comment With Your Proshare id


Navigation

Social Media