The Central Bank of Nigeria has redefined ATM withdrawal limits to encourage digital currency usage.
In a Tuesday (Dec. 6) press release, the CBN said that the daily maximum customer ATM withdrawal for naira, Nigeria’s currency, is now capped at 20,000 naira ($45). This is a huge step down from the previous limit of 150,000 naira ($337) per day.
The release also outlined new restrictions on weekly bank withdrawals, now limiting it to 100,000 naira ($225) for individuals and 500,000 naira ($1,124) for corporations.
“Customers should be encouraged to use alternative channels — Internet banking, mobile banking apps, USSD, cards, POS, eNaira to conduct their banking transactions,” the central bank said.
These new rules, which take effect on Jan. 9, not only severely limit the use of cash, but is also a step toward pushing Nigerians to embrace the country’s newly minted central bank digital currency (CBDC), eNaira. The CBDC was launched last year but has faced slow uptake among consumers.
By pushing the country toward embracing digital currency over cash payments in Nigeria, merchants and retail businesses could tap into the growing trend of crypto payments around the world.
According to a June PYMNTS report, “Paying with Cryptocurrency: What Consumers and Merchants Expect from Digital Currencies,” 77% of U.S. merchants that accept digital currency see the appeal of crypto transactions over standard payment methods.
The merchants said a major reason for the adoption was crypto’s lower transaction processing fees relative to other payment methods such as credit cards or cash.
Related: India’s Bankers Unimpressed With Digital Rupee
Other countries are also reevaluating how their CBDCs are implemented.
On Thursday (Dec. 1), seven bankers in India said that using the Reserve Bank of India’s (RBI) digital currency was very similar to the internet-based banking customers were already using. The RBI is in the process of launching the latest phase of its attempt to explore the feasibility of a CBDC.
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