Nigeria has drastically reduced the amount of cash that individuals and businesses can withdraw as it tries to push through its “Cashless Nigeria” policy and increase the use of eNaira, the digital currency of the Nigerian central bank (CBDC).

The Central Bank of Nigeria issued the directive to financial companies in a circular on December 6, noting that individuals and companies would now be limited to withdrawing $45 (20,000 Nigerian Naira) per day and $225 (100,000 Naira) per week. from ATMs.

Individuals and businesses will also be limited to withdrawing $225 (100,000 Naira) and $1,125 (500,000 Naira) respectively at banks per week, with a 5% fee for individuals and a 10% fee for companies for amounts above these limits.

The maximum cash withdrawal via POS terminals is also capped at $45 (20,000 Naira) per day. Announcing the changes, the director of banking supervision, Haruna Mustafa, noted:

“Customers should be encouraged to use alternative channels (internet banking, mobile banking apps, USSD, cards/POS, eNaira, etc.) to carry out their banking transactions.”

The limits are cumulative limits for each withdrawal, so a person withdrawing $45 from an ATM and then attempting to withdraw cash from a bank the same day would be assessed a 5% service fee.

The previous limits on daily cash withdrawals prior to the announcement were $338 (150,000 Naira) for individuals and $1,128 (500,000 Naira) for businesses.

Adoption rates for eNaira have been low since its launch on Oct. 25, 2021. As Cointelegraph reported Oct. 26, the Central Bank of Nigeria has struggled to convince its citizens to use the CBDC, with less than 0, 5% of the population. reported using eNaira as of October 25, one year after its launch.

Related: The Impact of CBDCs on Stablecoins with Bitget’s Gracy Chen

Nigeria established its “cashless” policy in 2012, suggesting that moving away from physical cash would make its payment system more efficient, reduce the cost of banking services, and improve the effectiveness of its monetary policy.

On October 26, Nigeria’s central bank Governor Godwin Emefiele said that 85% of all naira in circulation was out of banks and he would reissue new notes as a result in an effort to drive change. towards digital. Payments

According to a CBDC tracker from the US think tank the Atlantic Council, Nigeria is one of 11 countries to have fully implemented a CBDC, another 15 countries have launched pilot programs with India set to join the ranks later this month.