In a bold move aimed at driving Nigeria closer to a cashless economy, the Central Bank of Nigeria (CBN) has imposed a daily transaction limit of N1.2 million on Point of Sales (PoS) agents.
The decision was announced in a circular titled “Cash-Out Limits for Agent Banking Transactions,” which was released on Tuesday, December 17, 2024.
The new policy is part of the CBN’s ongoing efforts to enhance the use of electronic payment channels across the country. The central bank’s initiative seeks to reduce the reliance on physical cash while encouraging digital financial transactions.
According to the circular, the daily limit of N1.2 million applies to all PoS agents in Nigeria. This limit is part of a broader set of measures designed to regulate and streamline the operations of agent banking in the country.
Oladimeji Yisa Taiwo, who signed the circular on behalf of the CBN’s Director of Payments System Management Department, emphasized the need for these measures to “enhance the use of electronic payment channels for agency banking operations.”
This restriction comes at a time when PoS transactions are seeing a rapid increase across the nation. As of July 2024, there were 3.05 million deployed PoS terminals and 4.06 million registered PoS terminals in Nigeria, according to the Nigeria Interbank Settlement System Plc (NIBSS).
The rise in PoS usage has been part of the CBN’s effort to expand financial inclusion. It is estimated that over 70% of Nigerians rely on PoS terminals for daily transactions, particularly in rural and underserved areas where traditional bank branches are scarce.
However, as PoS agents become key players in Nigeria’s banking sector, their operations have increasingly come under scrutiny. The CBN’s new policy aims to regulate these operations and ensure that they align with the central bank’s vision for a cashless society.
The new regulations also introduce an individual withdrawal limit. According to the policy, each customer is now restricted to a weekly cash withdrawal limit of N500,000, regardless of the banking channel used. This means that even if a customer conducts transactions through multiple channels, they cannot withdraw more than N500,000 in a week.
Furthermore, the new limits extend to cash withdrawals at PoS terminals. Agents will now be restricted to a daily cash-out limit of N100,000 per customer, meaning a single customer can only withdraw up to N100,000 per day from a PoS agent, with the overall daily limit for each agent set at N1.2 million.
The decision has sparked mixed reactions from Nigerians, especially PoS agents. Some agents argue that the new limit will negatively impact their businesses, particularly those in rural areas where PoS transactions are a lifeline for daily commerce.
A PoS agent in Lagos, who requested anonymity, voiced concern about the daily limit, stating, “It’s going to be difficult for us to meet the demands of our customers, especially those who need to withdraw larger sums. Many people depend on PoS for their businesses, and this new rule will make it harder for them to access their money.”
The new policy also affects customers who frequently rely on PoS agents for larger transactions. One such customer, Chijioke Opara, expressed frustration with the new rules, saying, “This is unfair. Why should I be limited to withdrawing just N100,000 a day when I need more for my business operations?”
Despite these concerns, the CBN insists that the policy is in line with its goal of fostering a cashless economy. The central bank has long advocated for the digitization of Nigeria’s financial transactions, arguing that it will improve efficiency, reduce the risks associated with carrying cash, and curb financial crimes such as money laundering.