Nigeria to Stop Cash Withdrawals From Government Accounts – Economics Bitcoin News
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From early March, Nigerian public officials will be barred from withdrawing cash from government bank accounts, the head of Nigeria’s money laundering intelligence unit said. Officials who wish to be exempted from this new regulation must obtain permission from the Presidency of Nigeria.
Government employees are exposed to money laundering
Nigerian government employees will not be allowed to withdraw money from government accounts from March 1, the head of the Nigerian Financial Intelligence Unit (NFIU), Modibbo R. Hamman Tukur, has said. The new rule, which applies to federal, local and state officials, aims to combat high levels of corruption and money laundering in government.
Additionally, according to a Reuters report, the new rule parallels the Nigerian government’s goal of achieving a cashless economy. The report also quotes Tukur, who explains the reasons for this decision. He said:
Civil servants are increasingly vulnerable to money laundering and its predicate offenses because they are exposed to cash withdrawals from public accounts.
In support of Tukur’s claims, the report noted that an analysis by the NFIU – an autonomous unit of the Central Bank of Nigeria (CBN) – showed that between 2015 and 2022, officials withdrew $2.45 billion in cash from government accounts. Most of the withdrawals exceeded the prescribed limits, the report added.
CBN’s New Payment System Plan
Meanwhile, in cases where cash is needed, Tukur said officials must seek exemption from the office of the president. However, this can only be granted on a “case-by-case basis”.
In its recently released Nigeria Payments System Vision 2025, the CBN said the goal is a “cashless and efficient electronic payment system” that will support financial services in all sectors by 2025. To achieve this, the CBN has initiated several reforms. which include the issuance of new naira notes and the phasing out of old notes.
The CBN has also set cash withdrawal limits for both businesses and individuals. Recently, the bank is also said to have instructed banks to stop cash withdrawals of new banknotes.
In addition to limiting the use of cash, the CBN is also seeking to increase the use of flagging central banks’ digital currency. Despite several measures taken to attract CBDC to users, Bitcoin.com News reported in October 2022 that many Nigerians had not embraced it.
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