Lawmakers express satisfaction with new banking policies

Lawmakers express satisfaction with new banking policies
Hauwa Noroh Ali, Abuja

The Nigerian House of Representatives has expressed satisfaction with the Central Bank  of Nigeria (CBN)’s clarifications on the new cash withdrawal limit policy and the proposed Islamic Banking.

The CBN Governor, Malam Lamido Sanusi, told the House on Thursday that the proposed Islamic banking policy was not aimed at discriminating against any Nigerian. 

Sanusi spoke when he appeared before the House of Representatives to explain the policies on cash withdrawal limit and Islamic banking following an invitation on July 19.  

Non-interest banking

Sanusi said the proposed bank would practice an interest-free banking policy.  

The CBN boss noted that non-interest banking was provided for in the Banks and Other Financial Institutions (BOFIA) Act 2007. 

"The CBN is not setting up an Islamic bank; neither is it advertising an Islamic bank. Islamic banking is not biased; it is open to all faith," Sanusi stated.   

He said that contrary to speculations, the concept of the bank was not to “Islamise the country” but to provide financial services to all Nigerians without regards to religion or ethnicity. 

Sanusi maintained that the bank would enhance the critical sectors through the introduction of new financing instruments to the banking public. 

He added that products of the bank would also provide financial assistance for all Nigerians who were ethically precluded from conventional banking.

Sanusi pointed out that the tendency to view every national issue as being religious or tribal would not advance the quest for national development. 

Cashless policy

On cash withdrawal limit, Sanusi said the apex bank had not set any limit to the amount an individual or corporate body could withdraw. 

He explained that customers could withdraw any amount provided they paid the amount charged on such transactions.

According to him, the proposed policy is aimed at reducing the rate of cash transactions in the industry. 

In his words; “The objective of the present policy on cash withdrawal is different; as it is targeted at the reduction of cash transactions in the banking industry in favour of electronic means of payment.’’ 

He added that about 86 per cent of in-branch bank cash withdrawals were less than 100,000 Naira in value, while less than 10 per cent transactions were more than 100,000 Naira.

“The industry proposal is not to place limit on cash transactions, but to provide that 10 per cent of customers that make high volume cash transactions will attract costs and eliminate the subsidy by the banking public.”

He stressed that the proposed cash withdrawal policy would have direct impact on the banking industry’s efficiency and cost structure. 

According to him, the Nigerian government’s policy on electronic payment had impacted positively on the country’s financial system by reducing rate of cash transactions. 

Driving efficient banking

He said that the banking industry was resolute on its decision to transform the national payments system to drive efficient banking and payments system services at a reduced cost to Nigerians.

Williams