With the expiration of the CBN suspension period, banks will resume processing fees on large deposits

Banks and other financial institutions across Nigeria have reinstated processing fees on large cash deposits following the expiry of the Central Bank of Nigeria (CBN) temporary suspension.

The suspension, which affected deposits of more than N500,000 for individuals and N5 million for corporates, ended on April 30, 2024.

During the suspension period, customers benefited from the usual processing fees of 2% for individuals and 3% for corporates on large deposits.

This initiative was part of a broader regulatory effort aimed at promoting bank deposits and managing liquidity in the financial system.

An email from Sterling Bank announcing the reintroduction of high deposit fees said:

• “We would like to remind you of the temporary suspension by the Central Bank of Nigeria of processing fees on cash deposits exceeding N500,000 for individuals and N3,000,000 for companies until Tuesday, April 30, 2024.
• “During this period, you can deposit cash above these thresholds at any Sterling branch without incurring the usual processing fees of 2% and 3% for individuals and businesses respectively.
• “We would like to inform you that from Wednesday, May 1, 2024, processing fees for cash deposits exceeding the thresholds have been reintroduced.
• “This means that if you deposit cash over N500,000 (for individuals) or N3,000,000 (for corporates) at a Sterling branch, the corresponding processing fee of 2% and 3% will apply respectively.”

More insights

• The CBN issued a directive to all banks, other financial institutions and non-bank financial institutions in December 2023, suspending the processing fees previously charged on large cash deposits.
• This change, referred to in the “Guide to Fees of Banks, Other Financial Institutions and Non-Bank Financial Institutions”, affects deposits above N500,000 for personal accounts and N3,000,000 for corporate accounts.
• In early 2019, the CBN announced that it would begin charging bank customers fees for cash deposits and withdrawals starting September 19, 2019. In a circular released to the public, the apex bank said the new policy on transaction fees is aimed at reducing cash in use.
• Nairametrics recently reported that non-bank currency surged in March 2024 as Nigerians hold 94% cash in hand. An analysis of the CBN’s latest money and credit statistics data showed that cash in circulation stood at N3.87 trillion, but cash holdings outside banks stood at N3.63 trillion.