On Tuesday, the Central Bank of Nigeria announced its latest policy, limiting cash withdrawals from Automated Teller Machines (ATMs) and over-the-counter to N100,000 and N500,000 for individuals and corporate organizations, respectively.

The policy also mandated Deposit Money Banks (DMBs) and Other Financial Institutions (OFIs) to load only N200 and lower denominations into ATMs. The Director, Banking Supervision Department of CBN, Mr. Haruna Mustafa, also added that daily withdrawal from ATMs will now be N20,000 subject to N100,000 per week.

To quote the CBN statement fully, “Withdrawals above these limits shall attract processing fees of 5.0 per cent and 10 per cent, respectively; third-party cheques above N50,000 shall not be eligible for payment over the counter, while extant limits of N10 million on clearing cheques still subsist; the maximum cash withdrawal per week via Automated Teller Machine shall be N100,000 subject to a maximum of N20,000 cash withdrawal per day.

“Only denominations of N200 and below shall be loaded into the ATMs; the maximum cash withdrawal via the point of sales terminals shall be N20,000 daily.
“In compelling circumstances, not exceeding once a month, where cash withdrawals above the prescribed limits are required for legitimate purposes, such cash withdrawals shall not exceed N5 million and N10 million for individuals and corporate organisations, respectively, and shall be subject to the referenced processing fees in (1) above, in addition to enhanced due diligence and further information requirements.

“Further to (6) above, you are required to obtain the following information at the minimum and upload same on the CBN portal created for the purpose.”

Immediately the policy was announced, till this moment, there have been various reactions to the policy, with some hailing it and others knocking it. I also want to add my voice to the reactions, hence this article.

First of all, I would like to opine on why I think the CBN believes this is necessary at this time. The obvious first answer is that this move helps entrench the CBN cashless policy. If people cannot withdraw cash in large numbers, more people would embrace USSD and mobile banking options. Another reason for the policy is that it would help tackle illicit cash flow as kidnappers who erstwhile demand for large sums of money in cash might not get their wishes met this time since there is no cash in circulation. Some have said this policy would also help curb inflation although I do not see how at this time.

Politicians who have to spend cash for election purposes might also be on the receiving end of this policy. This policy might also have the (unintended?) effect of curbing extortion by Police Officers and other government agents. On the surface, all these seem like a great policy that would have positive fiscal and monetary consequences.

My objection to the policy stem from the fact that it is inconsiderate and does not seem to appreciate the demographic make-up of the country. For instance, according to the World Bank, about 55% of Nigerian adults are either unbanked or underbanked. This policy will act as a constraint to cash, and for such people, access to cash is like access to water. I fear that much thought was not put into this policy as regards these unbanked people. Another group of people affected by this policy are the agent banking operators (“POS people”) who have been doing a fantastic job driving financial inclusion. I wonder how folks who cannot withdraw more than N200,000 daily and maximum of N500,000 are expected to function effectively in their business.

Perhaps my biggest fear is how this policy can bring about the emergence of a black market. As a cynical Nigerian, I would not be surprised if certain elements are able to collude with banks and gain access to cash in large numbers, then sell to people who desperately need access to cash for a fee. We might have a whole industry of arbitrage swing up because of this policy, and at the end of the day only the poor suffer.

On a final note, it’s instructive to note that the CBN under the leadership of Godwin Emefiele has consistently come up with bizarre policies that do not add any value to the system (cutting of trees to dissuade money changers, banning Abokifx because of Dollar price, the eNaira etc). It is hard to believe that this new policy will not simply be one of such.

I hate messiahs (apologies to Christ). Right from when I was much younger, I hated the idea of a father figure who’s supposed to be a saint coming in to fix the mess that others have created. And as African countries have shown us time and again, Messiahs are fraudulent almost every time. What truly brings change in society are institutions working together to effect positive development.

In 1787, during the United States Constitutional Convention, the majority of the members wanted a Lifetime presidency, and were willing to grant the presidency more powers than they thought was necessary, because it was widely and correctly assumed that George Washington would be the first President. His demeanor towards that proposal made them struck it off, and although there were no term limits for the office then, he chose to step down after 2 terms, setting a precedent that was followed by all Presidents from 1797 up till 1940.

Contrast that with African “Founding Fathers”, who decided to cling on to power until they died or were kicked out by military coups, setting up a chain of instability, violence and chaos across the continent.

Of course, I understand that much of this has to do with our culture, and the idea of a “Father” who can rule his house with a strong fist and exercise good judgement and all what not. However, any culture that doesn’t fit into the dynamics of modern society needs to be done away with. States don’t get developed when one person is in charge of every aspect of societal building. No matter how smart one is, it is unfair (on both the state and the person) to think they can proffer all the solutions to the problems a state has.

If Nigeria would truly develop as a society, we’ve got to begin to instill the idea of synergy and collective leadership to ensure a progressive state. From social clubs, to student unions to political office, those who would want to collapse the structure of the organization into their personal capacities must be vehemently rejected. Focus should be on ensuring that an organization can work well in the absence of one person. Simply put, we must be a nation of Laws, not a nation of men.

I boldly assume that the smooth organization of the recent #EndSARS movement was due to a focus on collective effort and leadership. This made it impossible for the government to weaken the organizational structure. It would have been very easy to do this if there were “leaders”. The way protests carried out by the NLC ends is a telling example. Our generation must lay more emphasis on words like collective, collaboration, we, joint and everything they imply rather than words like I, leader, sole administrator etc.

There’s so much work to be done, really.

In Nation building, there are 2 important P’s. First is Protest, which we’re already doing. The second is Politics.

While we must ensure not to politicize the protests, it has given us a golden opportunity to sanitize the political space.

Young people must now begin to take a more active role in the political process, as candidates, voters and lobbyists.

While we still insist on Police reform, we must now pile pressure on the electoral body to begin the process of voter registration, as well as ensure that the President signs the electoral reform bill.

If this is done, our work should now be divided into ensuring that as many young people as possible are registered to vote, and that young people begin to build structures that would make it possible for them to win elections in this country (would be a silly mistake to automatically assume that people would vote for you. You need to get the work done).

Personally, I don’t believe in the idea of a Youth Party (because I believe the quality of your ideas isn’t determined by your age). What I strongly believe should be done, and something I’m glad the current movement has given to us, is for “lobbying / pressure groups” to spring up and push candidates for elections in various parts of the country. For example, the Feminist coalition can use its platform to support candidates that would push women rights agenda across various political offices, regardless of the political party they belong in. The tech firms can also do this for candidates that would be pro-tech, and several groups can spring up for several policy ideas. This would reduce the reliance of young candidates on a Godfather who sponsors them because of financial enticement. It would also lead to an increased focus on issue based politics, as the different groups that spring up would ensure that voters have a clear distinction between the candidates.

As voters, we must ensure that we strongly scrutinize those that come before us for our votes. We have no business voting in someone who can’t give a 30 minutes (at least) speech defending his/her policy proposals. The days of “I will create 1 million jobs” should be over forever. We must insist on candidates breaking down all of their policy proposals and telling us how and where they would get the money to fund it. Candidates that don’t give a sensible response should be avoided like the plague.

Despite the unity we’ve displayed in this protest, there are many differences amongst the Nigerian Youth. I see these differences as a good thing. I believe that we want the best for our country, and only differ on how to achieve this. If these differences are made a talking point in the coming elections, it would galvanize young people to participate in the political/ electoral process as never seen before, and I strongly believe this would lead to a more sanitized political space. If this happens, I have no doubt that it would lead to a better nation.

I’m writing about the real world, I have no illusions that it would be as easy and straightforward as I have penned it down. But I believe we can’t get the system to work, for all of us.

FMA. 💙❤️