How Reps reacted to CBN Cash Withdrawal Policy

Majority of lawmakers in the House of Representatives oppose the Cash Withdrawal Policy, to explore the possibility of CBN Governor making explanations to a Joint Session of the National Assembly

CBN

The House of Representatives has expressed dismay with the recent weekly cash withdrawal limits set by the Central Bank of Nigeria (CBN) and the possible economic and social challenges it could pose.

The lawmakers, who were visibly angry on Thursday, demanded a policy suspension by the CBN Governor, Godwin Emefiele and further mandated him to appear before the House next week to explain its impact to Nigerians. According to the House, the suspension will be lifted pending the outcome of the expected engagement with the Green Chamber on compliance with relevant sections of the CBN Act and the 1999 Constitution on the monetary policies of the apex bank.

These resolutions were sequel to a motion under Matter of Urgent National Public Importance brought by Rep. Magaji Dau Aliyu (APC, Jigawa).

It can be recalled that the CBN had slated January 9, 2023, as the day to kick start implementation of the new policy.

Leading the debate on the matter, Rep. Aliyu argued that the policy would cause untold economic hardship to his constituents. He said, “Majority of the small business owners in Nigeria are the major drivers of Nigeria’s economy, and who are majorly, residents of rural area and carried on their business, trade and activities in the said rural business areas.

The majority of these small business owners transact their businesses, trade and transactions in physical cash and are in most cases, not inclined to the use of the electronic banking system as most of them are either illiterate, half-educated or not learned at all. These set of Nigerians who are the drivers of Nigeria’s economy will seriously be negatively affected, and their business and source of livelihood may be seriously impaired with these new directives of the Central Bank of Nigeria (CBN).

This directive of the Central Bank has been generating serious uproar and has given low business owners serious concern since the said release as a result of the impact it may have given short time notice given by the Central Bank of Nigeria (CBN). The new policies rolled out by the Central Bank of Nigeria (CBN) will definitely have a negative impact on the already dwindling economy and further weakens the value of Nigeria as Nigerians may resolve to using dollars and other Currencies as a means of trading, and thus further de valued Naira and weakens the economy.”

Aliyu further expressed concern over the policy, saying that Nigeria, at the moment, lacked the necessary infrastructure to execute the policy.

“My heart bleeds for the people who voted us into power, we seem to come to Abuja and forget about them, and this is my opinion. Only a month ago, we woke up to hear that there will be new currency notes and changes in the currency notes, and they can do it; as far as I am concerned, there is no single bank in my constituency.

I do not know how my people will go and change this money. I do not know where my people will go and get it; the best we have is the POS, and our people still deal in physical cash. It is good to have a cashless policy, but we seem to be borrowing ideas and policies from other countries that are far ahead of us; we are comparing ourselves with the United States and the United Kingdom; these people are far ahead of us, we will get there one day but these type of policy disturbs the people that voted for us.

The issue affects everyone, most of our people are in rural areas, and everything is being done in naira and cash, and somebody will wake up and make a policy that will start tomorrow, no consultation. People have forgotten that 80 to 90 per cent of our people are in rural areas; we must do something to save the situation. If there are enough banks and facilities, why not, it will work. I urge colleagues to support this motion so that this policy will be rescinded.”

Rep. Aminu Suleman (APC, Kano state) supported the motion and said the policy should not be allowed to fly.

“This could be an exit board for many of us if we allow this radical decision to succeed, and therefore my voice must be heard on this. There are several government Chief Executives in this country that have outlived the essence of their positions because I cannot simply understand how we can wake up one day and introduce this draconian approach to businesses, giving Nigerians one month to adjust their belts.

More than 70 per cent of communities in this country do not have a banking system, and only a few, like Lagos, Rivers, Kano and probably Delta states, might boast of about 70 per cent banking coverage. Yet the CBN under the almighty Emefiele woke up and introduced this very heartless decision; this will completely eradicate all the successes we have gathered as a country in order to arrest restiveness and banditry.

This is because the little intervention we have made by introducing small-scale businesses will be completely whipped out; thousands of Nigerians have come to live and do business through the POS. All these will go away with the introduction of this policy, and I cannot understand how Nigerians will be able to manage our businesses that are predominantly in cash with a withdrawal of N100, 000 per day.

I think that beyond rhetorics, we should search our books and impose necessary legislation to ensure we arrest the situation; we have more powers, and we can look into the powers of the CBN and remove the excess powers for us that we can act on behalf of Nigerians.

To allow this means every other Chief Executive is independent, and they can go and brief the President, and he will give them the bearing, we must arrest these things and ensure that it is not done,” he said.

However, the Minority Leader, Rep. Ndudi Elumelu (PDP, Delta), in his remarks, opposed the motion. For him, the policy would curb banditry and reduce the incidence of corruption.

He said: “On the issue of cashless policy, I think that is the best thing that can happen to this country; even though the timing might be difficult, we may ask for an extension of time for it to be well implemented. The policy will help; stories are going around Abuja; even when people go to use the POS to withdraw money, they are people waiting to cut off their hands to collect the money.

If there is a cashless policy and people use their phones to transfer money, some of such things will not happen, and that is the truth. There was a time when banks went to the markets to mop up cash after sales.”

In his contribution, Rep. Nnolim Nnaji (PDP, Enugu) also criticised the policy.

“In the last month, we have experienced CBN policies, the currency change, and now we are talking about cash withdrawal limit. This decision is totally against commerce; there is nowhere in the world; in the economic situation we are in now, we need more spending than savings.

The only way to drive an economy in this situation is for people to be spending money, not saving money, and for businesses to move. We cannot, at this point, subject ourselves to one man, the decision is totally wrong, and all of us must rise and say no because it affects the people it affects.

Yes, the CBN has the power to do so, but we also represent the people and before you let such a decision out, we as the representatives should be aware so we can see how we can face the people,” he said.

On his part. Rep. Julius Ihonvbere (APC, Edo) lampooned Emefiele for allegedly towering above the National Assembly.

“We are farmers. Beyond the work I do in this place, my constituency has no federal presence. We don’t have any big agencies. So, essentially, there are many communities like that across Nigeria. The CBN has not done anything to get the banks to establish branches across the country, sufficiently that someone does not have to travel for an hour and a half before accessing banking services.

The way the CBN is going in this country…in fact, the CBN governor is acting like he is more powerful than the President and the National Assembly. Policies after policies are being rolled out. You have not settled on one; you are bringing another. You sent timelines, completely unreasonable timelines,” he said.

Midway into the proceedings, Rep. Mark Gbillah (NNPP) raised a point of order, citing relevant sections of the CBN Act and the 1999 Constitution, reminding the House that the CBN governor should be giving periodic briefings on monetary policies of the apex bank to the National Assembly.

He noted that the CBN was yet to explain to Nigerians how the redesigning of the Naira was funded, stressing that there was no approval of such expenditures by the National Assembly.

Some other lawmakers who also spoke opposed the new policy but agreed it would suffice to hear from the CBN governor respond to questions that will be posed to him. To that end, the Speaker, Rep. Femi Gbajabiamila, heeded the prayer of the substantive motion and ruled that Governor Emefiele be summoned to brief the House Thursday next week.

“If you want to comply with the act, ordinarily he should be appearing before the whole National Assembly. I think you will allow me to speak to the Senate President and see whether in compliance with the Act, we can have a joint session. I think this is important enough for him to brief the National Assembly but if that fails, appearing before the National Assembly does not necessarily means in a Joint Session. If he appears before the Senate separately and appears before the House separately, he has appeared before the National Assembly but to save time, I will ask if that is possible,” Gbajabiamila said.

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