The Central Bank of Nigeria (CBN) on Thursday said the cash withdrawal limit will help tackle kidnapping and reduce cost of minting new notes.
Late Wednesday, the CBN increased the maximum weekly limit for cash withdrawal across all channels to N500,000 and N5,000,000.
Deputy Governor, Financial System Stability, Aisha Ahmad, who briefed the House of Representatives, said the policy will also check money laundering.
She said it will reduce cost of processing cash, cost of minting new notes as well as cost of destroying old tenders.
She explained available data indicate that 94 per cent of all cash transaction falls within the new limit of N500,000.
She said 82 per cent of corporate cash transactions fall below the new limit indicated for corporate bodies.
The implication, she said, is that about 84 per cent of individuals will not be affected by the cash withdrawal limit.
Ahmad added that processing fee on the excess withdrawal will only be charged against the extra cash and not the entire sum.
She said as a result of feedback from Nigerians and the concerns raised by the House, the apex bank raised the weekly withdrawal limit from N100,000 to N500,000.