CBN Moves to Stop Banks’ Dollar Withdrawal Restrictions

 

The Central Bank of Nigeria is investigating complaints that some commercial banks are restricting customers’ access to foreign currency deposits in their domiciliary accounts, with the apex bank considering measures to ensure legitimate withdrawal requests are honoured.

The development followed complaints by customers who said they had encountered different restrictions while attempting to withdraw dollars, pounds and other foreign currencies from their accounts. Checks in some banks in Lagos showed that customers were allegedly subjected to transaction limits, while some were told that particular currencies were unavailable.

In one case, a customer who requested to withdraw $5,000 from an old-generation bank was reportedly told that only $3,000 could be provided. The teller was also said to have expressed uncertainty over whether the customer would be able to obtain the full amount if he returned the following day.

At another commercial bank, a customer seeking dollars was told that the currency was unavailable and advised to keep checking. However, another customer at the same bank claimed he had recently withdrawn $4,000. At another bank on Victoria Island, a customer said he had just withdrawn $1,000 after being told that was the maximum available for over-the-counter dollar withdrawals.

A source close to the CBN said the apex bank had received several complaints from members of the public concerning difficulties in accessing cash from domiciliary accounts despite complying with applicable requirements. According to the source, the complaints include practices that could unnecessarily delay legitimate withdrawal requests.

The source said the CBN was considering issuing a circular directing banks to review their procedures and desist from practices that unnecessarily restrict or delay legitimate cash withdrawals. The move is also expected to address concerns that such practices could create an impression of banking distress. Meanwhile, some banking sources have alleged that certain banks may be diverting available foreign currency cash to trading activities rather than releasing it to customers. The allegation has heightened concerns among domiciliary account holders over access to their legitimate foreign currency deposits.