As the Central Bank of Nigeria’s (CBN) decision to limit the amount of money that can be withdrawn through bank counters and ATMs to N100,000 per week for individuals and N500,000 for companies continues to draw criticism, human rights lawyer Femi Falana has spoken out expressed on the subject.
The Senior Advocate of Nigeria (SAN) said the new withdrawal policy was against the law and therefore illegal.
On December 6, CBN announced the new policy, which also allows just N20,000 withdrawals from POS per day as part of its broader monetary policy, and directs financial institutions to start implementing it from January 9, 2023.
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The new policy was announced following the redesign of the N200, N500 and N1,000 banknotes that Apex Bank had re-issued for November 23.
Both moves by the central bank have drawn both praise and condemnation. While some Nigerians have welcomed the new CBN initiatives as a possible means of curbing uncertainty and inflation, others, including Falana, have said the new payout limit is against the law.
In a statement Monday, Falana described the policy as “illegal and null” as it violates the provisions of Section 2 of the Money Laundering Act 2022. He argued that Section 2 of the law limits cash withdrawals by individuals and businesses to N5 million and N10 million respectively.
According to him, the new CBN policy is “null and void” unless Section 2 of the Money Laundering Act is amended to that effect.
“There has been no change since the Money Laundering Act of 2022 (which set the maximum cash withdrawal at N5 million) the limit on cash withdrawals set by the Central Bank to no more than N20,000 per day and N100,000 per week Nigeria is illegal in any material, null and void,” said Falana.
“We call on the Nigerian people to ignore the illegal announcement.
“However, we are compelled to urge President Muhammadu Buhari to instruct the management of CBN to withdraw the illegal policy and not announce any further measures aimed at condemning poor citizens to even more unbearable economic hardship,” he added.
Meanwhile, CBN governor Godwin Emefiele had said he had Buhari’s support to implement the controversial policy.
Last week, the House of Representatives subpoenaed the governor amid growing concern that the new payout limit could create economic headwinds for small and medium-sized enterprises (SMEs) in the country, particularly in rural areas.
However, Emefiele assured that the central bank has taken reasonable precautions to ensure the concerns are addressed.