Nigeria CBN Suspends Fees for Cash Deposits Over N500,000 Until April 2024

The Central Bank of Nigeria (CBN) has made a strategic move to bolster cashless transactions by announcing the suspension of processing fees on cash deposits exceeding N500,000 until April 2024. The decision, communicated through a circular signed by Adetona Adedeji, the acting director of banking supervision, marks a significant shift from the policy implemented on September 18, 2019.

Initially introduced to incentivize electronic transactions, the CBN had imposed a 2 percent processing fee for deposits over N500,000 and a 3 percent fee for withdrawals. Corporate account holders faced a 5 percent processing cost for withdrawals and 3 percent for deposits exceeding N3 million. This move aligns with the apex bank's long-standing objective, first hinted in February 2017, to reintroduce fees on large-scale cash transactions nationwide.

In the latest development, the CBN urged all banks, financial institutions, and non-bank financial institutions to accept cash deposits without imposing fees, effective immediately. The circular stated, "The Central Bank of Nigeria hereby suspends the charging of processing fees of 2% and 3% previously charged on all cash deposits above these thresholds with immediate effect. This suspension shall remain in effect until April 30, 2024. Consequently, all financial institutions regulated by the CBN should accept all cash deposits from the public without any charges going forward."

This move is expected to influence banking behavior and encourage greater participation in cashless transactions, fostering economic growth and financial inclusivity.