Banking
Cashless Policy: No Going Back on Deposits Charges—CBN
By Adedapo Adesanya
Despite the recent criticisms that trailed the re-introduction of processing fees on deposits and withdrawals on certain thresholds by individual and corporate bank customers in seven states of the country, the Central Bank of Nigeria (CBN) has said it won’t back down.
The apex bank had directed deposit money banks in the country to begin implementation of this cashless policy from Wednesday, September 18, 2019 and since then, many have lambasted the CBN.
Governor of the central bank, Mr Godwin Emefiele, while briefing journalists at the end of the Monetary Policy Committee (MPC) two-day meeting on Friday in Abuja, said this cashless policy was not new and that since its first introduction in 2012 and withdrawal in 2014, Nigerians had five years to bring their cash into the banking space.
“Fees on excess cash withdrawals are not new and have been in place since July 2012. Deposit fees are also not new.
“They have been in place since inception but later withdrawn in 2014 following feedback on the need for stakeholders to fully embrace electronic payment before implementation
“We believe that after five years and with all the options and channels that are currently available that we need to really embrace the best practices by saying we should go cashless in Nigeria,” the CBN chief said during the briefing monitored by Business Post.
Based on data between 2012 and 2018, Mr Emefiele said the cost of currency management in 2014 reduced by 13 percent following the first introduction of the policy including charges on both deposits and withdrawal in the ‘six cashless states’ throughout 2013.
However, Mr Emefiele disclosed that due to the suspension of the policy on deposit charges in 2014, currency management cost went up from 2015 and increased year-on-year basis to 2018 at an annual rate of 33 percent.
Mr Emefiele further noted that the policy was put in place to encourage the use of electronic means of transaction and reduce but not eliminate cash-based transactions.
“It is in the public’s interest to promote an efficient payment system via the cashless policy which helps to reduce the punitive cost of cash processing passed on to money deposit banks”
He noted that the strategy will help promote an open and transparent system because “Cashless policy also improves transparency in financial dealings and reduction in crime such as advanced fee fraud, graft, ransom fee payment, and extortions.”
He also said that since the pilot of the cashless policy that electronic transactions had increased substantially within the Nigerian economy.
According to Mr Emefiele, “POS transactions increased by 4692 percent and we are talking about N2.27 trillion from just N48.6 billion in 2012 to N2.3 trillion at the end of 2018”
He added that electronic transfers increased significantly by 1967 percent or N76.5 trillion from N3.8 trillion in 2012 to N80.4 trillion in 2018. Cheque transactions had also reduced by 32 percent by about N2.45 billion from 7.48 billion in 2012 to 5.03 billion in 2018.
He then disclosed that financial access funds, ATMs, Agents, and Mobile Cash across each of the six cashless policy states all witnessed exponential growth.
Business Post reports that based on the new policy, individual customers would only be required to pay 2 percent fee on deposits above N500,000 and 3 percent on extra amount above N500,000 when withdrawing.
For corporate customers, they would pay 3 percent on deposits above N3 million and 5 percent on withdrawals above N3 million.
By Aduragbemi Omiyale
The Central Bank of Nigeria (CBN) has reaffirmed that the old and new Naira notes will continue to be used for financial transactions in the country beyond December 31, 2024.
There had been rumours that the old and redesigned N200, N500, and N1,000 banknotes would no longer be legal tender from Wednesday, January 1, 2025, because the central bank would phase out the notes in compliance with a Supreme Court judgement of November 29, 2023.
But the apex bank, in a statement signed by its acting Director of Corporate Communications, Mrs Hakama Ali, on Friday, clarified that the apex court’s judgement being cited did not authorise the bank to phase out the banknotes by the end of this year.
According to her, the court allowed the CBN to leave the old and new notes to be used concurrently until it decides to gradually phase out the former.
The central bank’s spokesperson urged members of the public to disregard claims suggesting the old series of these denominations would cease to be valid at the end of this year.
She urged them to continue to accept all Naira notes for daily transactions, encouraging banks to also adopt alternative payment methods such as electronic channels to reduce the pressure on physical cash usage.
“The Central Bank of Nigeria (CBN) has observed the misinformation regarding the validity of the old N1000, N500, and N200 banknotes currently in circulation.
“In line with the bank’s previous clarifications and to offer further assurance, the CBN wishes to reiterate that the subsisting Supreme Court ruling granted on November 29, 2023, permits the concurrent circulation of all versions of the N1000, N500, and N200 denominations of the Naira indefinitely.
“For the avoidance of doubt, all versions of the naira, including the old and new designs of N1000, N500, and N200 denominations, as well as the commemorative and previous designs of the N100 denomination, remain valid and continue to be legal tender without any deadlines,” the statement noted.
By Adedapo Adesanya
Access Bank Plc, the banking subsidiary of Access Holdings Plc, has entered into a binding agreement with South African-based Bidvest Group Limited for the acquisition of 100 per cent equity stake in Bidvest Bank Limited.
The deal for the 24-year-old South African lender is due to be completed in the second half of 2025, upon regulatory approval.
This shows Access Bank’s further expansion plans in line with goals set by its late founder, Mr Herbert Wigwe.
The agreement to acquire 100 percent stake in Bidvest Bank reflects Access Bank’s commitment to strengthening its footprint in South Africa and consolidating on its position as the continent’s gateway to global markets as it seeks to optimise the benefits of recent acquisitions and accelerate its transition towards a greater focus on efficiencies.
Bidvest Bank, founded in 2000 is a niche and profitable South African financial institution providing a diverse range of services, including corporate and business banking solutions and diverse retail banking products.
As of its year ended June 2024, Bidvest Bank reported total assets equivalent of $665million and audited profit before tax of $20million.
Upon conclusion of this acquisition, Bidvest Bank will be merged with the bank’s existing South African subsidiary to create an enlarged platform to anchor the regional growth strategy for the SADC region.
This is coming just as the bank opened a new branch in Malta as part of efforts to focus on international trade finance after obtaining a banking licence from the European Central Bank (ECB) and the Malta Financial Services Authority (MFSA).
Access Bank said the licence marks a transformative milestone in bolstering Europe-Africa trade flows.
The Maltese branch was established by Access Bank UK Limited, the subsidiary of Access Bank Plc, which is also the subsidiary of Access Holdings Plc, which is listed on the Nigerian Exchange (NGX) Limited.
By Modupe Gbadeyanka
To strengthen Europe-Africa trade ties, Access Bank has opened a new branch in Malta. It will focus on international trade finance, employing approximately 30 people in its initial phase, with plans for controlled expansion over time.
It was learned that this Maltese branch was established by Access Bank UK Limited, the subsidiary of Access Bank Plc, which is also the subsidiary of Access Holdings Plc, which is listed on the Nigerian Exchange (NGX) Limited.
Access Bank Malta Limited commenced operations after obtaining a banking licence from the European Central Bank (ECB) and the Malta Financial Services Authority (MFSA).
Access Bank said the licence marks a transformative milestone in bolstering Europe-Africa trade flows.
Malta, a renowned international financial centre, and a gateway between the two continents, is strategically positioned to play a pivotal role in advancing commerce and fostering economic partnerships.
This strategic expansion into Malta enables The Access Bank UK Limited to leverage growing trade opportunities between Europe and Africa.
It underscores the organisation’s commitment to driving global trade, financial integration, and supporting businesses across these regions.
“By establishing operations in Malta, we will gain a foothold in a market that bridges European and North African economies, moving us one step closer to our goal of becoming Africa’s Gateway to the World.
“It further enhances our bank’s capacity to support clients with innovative solutions tailored to cross-border trade and investment opportunities,” the chief executive of Access Bank, Mr Roosevelt Ogbonna, stated.
“Europe has emerged as Africa’s leading trading partner, driven by initiatives such as the Economic Partnership Agreements between the EU and African regions and the African Continental Free Trade Area (AfCFTA).
“With Europe-Africa economic relations entering a new phase, The Access Bank Malta Limited is ideally positioned to deepen trade and meet the financing and banking needs of our clients in these expanding markets,” the chief executive of Access Bank UK, Mr Jamie Simmonds, commented.
Also speaking, the chief executive of Access Bank Malta, Renald Theuma, said, “Malta is uniquely positioned as a bridge between Europe and Africa, making it an ideal location for our subsidiary. This move allows The Access Bank Malta Limited to engage more closely with customers in Europe and deliver tailored financial solutions that drive growth and connectivity across both continents.”
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