The Central Bank of Nigeria’s US Dollar Battle – And New $5,000 Intra-Deposit Limit

The Central Bank of Nigeria’s  US Dollar Battle – And New $5,000 Intra-Deposit Limit

Nigeria is not healthy. And the Central Bank of Nigeria (CBN) is applying panadol even when it knows that panadol has no chance of providing any cure. A few weeks ago, we got the news that commercial banks would only allow a maximum of $10,000 monthly (cash) deposit within Nigeria. Today, the latest is that the apex bank has adjusted that to $5,000.

Left and right, the apex bank is trying to wean Nigerians of US dollars. There are many consequences already, as most of the fintech trading foreign apps have been wounded, since their customers cannot fund dorm accounts for the transactions. A peer to peer is never efficient when you want to do fairly big deals.

“There is a $5,000 monthly cash deposit limit. We encourage you to make more deposits via electronic transfers. Cash funded transfers to beneficiaries with accounts in other banks in Nigeria are no longer allowed. There will be no restriction to the frequency or value of transactions for accounts funded through inflows but supporting documents are required before payments are processed. Cash deposits are no longer allowed for Wealth Management Investments.”

So, if you want to deposit cash into your dorm account in Nigeria, the maximum now is $5,000. But if you want to do electronic transactions, you can but of course the rates are always above the roof. Besides, when you do these deals, you have to provide documents that they are legitimate transactions.
The apex bank is trying many things. But I am not sure it has a chance: fixing Naira will come via factories and warehouses and not any financial engineering at CBN headquarters and commercial bank branches! Those factories and warehouses can include new digital products created by innovators.
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One thought on “The Central Bank of Nigeria’s US Dollar Battle – And New $5,000 Intra-Deposit Limit

  1. A country with amalgam of professors, scientists, researchers, innovators and entrepreneurs, scattered across the globe, is being run with a mentality bordering between ineptitude and desperation. As a Nigerian, I am beyond embarrassed.

    The question that keeps ringing in my head is, is this the only option, the best we can offer? Some of us are never wired to feel helpless or bereft of ideas, so it’s a struggle being comfortable with mediocrity.

    If it entails tearing down naira before rebuilding, can we be brave enough and get to work? This pathetic approach of micromanaging an economy that services over 200 million people is something I don’t accept.

    What does it take take fix Nigeria? We want to have them in hard numbers, so that we can start fixing them one after the other.

    The legendary Aristotle proposed Aristocracy as a governing class, where your level of education determines whether you can make the cut; another was Oligarchy, where your wealth determines if you can make the cut. If Nigeria were to choose either of the governing system today, how many of our current occupants will make the cut?

    We are failing a generation here, and I don’t want to participate in this carnage. We need folks who can get things done.

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