Why cant' we just engage in engage in discussions like civilized people? UK or USA , there is a cash withdrawal limit, any intent to go above this limit must be communicated in advance to your bank. Also there is a withdrawal limit on both credit and debit cards though they differ amongst banks.

In the US, you are not expected to have more than 10,000 USD on you as cash! I don't know why Nigerians are afraid of change, we keep using popular cliches like 'in the US or in the UK' yet, we are not ready to engage in any form of sacrifice to be like them. I still remember a mild drama that ensued recently at JFK as a result of the above subject matter!

Personally, I cannot remember the last time I walked into my bank to consummate a transaction. Everything is done electronically and online and I enjoy it. We need to deconstruct this our mentality of carrying money in huge sacks et al.

Even with all these efforts, over 70 percent of the Nigerian  populace is un banked and there is over 4.7 trillion Naira outside the banking system! BTW, I don't think your bank will 'close shop' or loose sleep if you, the originator of this thread decides to bury his 'money' or 'monies' (word coined for exclusively for this thread since poster deals in several foreign currencies!) in the ground . In fact , I think it will be the other way round!

MRbrownJAY:

^^
- if you want to make under the table payments to the illegal workers you employ.
- you want to keep a certain amount of cash in your office/home FOR EMERGENCIES etc
- payments have to be made in cash to certain distributors that have been ripped off by bounced checks.
- some businessmen need to be wine dined and entertained before they sign on the dotted line. (high class
hookers and coke cannot be paid for by CC.)

but also
- if you decide at 10pm that you want go out and make it rain in the club.
- you (as a married man) meet a great damsel and want to take her to a top hotel for some bedmatics, would you pay for the expensive room with your CC?!

djustice:

I received a strange email from a Nigerian bank today, indicating that

1. I would no longer be able to withdraw more than N100,000 per day of my own money, from my own account

OP, please which  bank is this?

And what is the customer to do if one requires to withdraw more than 100k? Give the bank 2weeks notice? 

deenee:

Why cant' we just engage in engage in discussions like civilized people? UK or USA , there is a cash withdrawal limit, any intent to go above this limit must be communicated in advance to your bank. Also there is a withdrawal limit on both credit and debit cards though they differ amongst banks.

In the US, you are not expected to have more than 10,000 USD on you as cash! I don't know why Nigerians are afraid of change, we keep using popular cliches like 'in the US or in the UK' yet, we are not ready to engage in any form of sacrifice to be like them. I still remember a mild drama that ensued recently at JFK as a result of  the above subject matter!

Personally, I cannot remember the last time I walked into my bank to consummate a transaction. Everything is done electronically and online and I enjoy it. We need to deconstruct this our mentality of carrying money in huge sacks et al.

Even with all these efforts, over 70 percent of the Nigerian  populace is un banked and there is over 4.7 trillion Naira outside the banking system! BTW, I don't think your bank will 'close shop' or loose sleep if you, the originator of this thread decides to bury his 'money' or 'monies' (word coined for exclusively for this thread since poster deals in several foreign currencies!) in the ground . In fact , I think it will be the other way round!

it amazes me when we try to copy how things work in US or UK forgetting that their economy and level of development is way different from ours.

it might sound like a good initiative on sanusi's part but in my own opinion, the timing is wrong.

a country where power supply is epileptic. . . . i have had experiences of trying to withdraw money from an ATM machine only to discover that the machine has been powered off because there is no electricity in the premises.

what about the reoccurring issue of customers' accounts being debited with no cash dispensed at the ATM

a country where internet service is still below par. . . . . how can one rely on the internet for 'e-banking'

how many banks realistically operate intra-bank transfers in Nigeria without having to visit the banking hall. To the best of my knowlege, it is only GTB that currently provides that service and you need a ''token'' which is used to generate a unique number and bear in mind that you have to pay for the token. With all their noise about 'telephone banking', you cannot do an intrabank transfer by calling the GTCONNECT line without the ''token''.

there are other areas that sanusi should focus on such as outrageous/hidden bank charges, interest rates, loans to SMEs, exchange rate of the naira to other currencies, etc

It's like there are a lot of stupid Nigerian bankers awake on Nairaland today.

First off, I meant to say, as I explained in my original post, that I will no longer keep my money in Nigerian banks. There are at least two non-Nigerian banks in Nigeria, and if they fumble, well, there is always offshore banking with any of the UK banks, and since Sanusi insists, despite the obvious IT infrastructure deficit (system upgrade, anyone), on "e-banking", repeating over and over again like some new word he just learnt, there's always VISA.

As to the issue of over-the-counter withdrawal limits in the UK, THERE IS NO SUCH THING. The only requirement is that if you're withdrawing a large amount, you give your bank a week's heads-up, and you can withdraw your money, no charge.

Nigerian banks behave as if they're doing you a favour by trading with your money, and they overcharge for their yeye services. Most of their staff have no product knowledge and can't even advise their customers properly on their own products. They come across as so stupid and ill-informed.

As if all that was not bad enough, along comes the Sharia Banker, who has now got "e-banking" on the brain like a clot, whereas he's simply using that to achieve his ill-disguised agenda of killing the Southern banks. Some of the buffoons defending him here are southerners too. How pathetic is that A man is sticking it to you, in your very before, and all you can do is hail him No wonder y'all are treated like slaves. It's really hard to pity Nigerians sometimes.

To those who want to know what I'm worth, what does it matter to you I feel strongly enough about limitations on the amount of my own money, that I worked for, that I can actually withdraw daily. If you don't, good luck to you. It sure as hell feel a lot like slavery to me!

And to those that say it is illegal to carry any amount of money into the US, your ignorance is just annoying! You can carry ANY AMOUNT of cash into the US, as long as you declare it. Declaration has some conditions, including proving where you're bringing the money from is a legitimate source, and telling them what you wish to use it for in the US, plus of course, you must give the address you're going to be staying at while there.

IGNORANCE IS A TERRIBLE THING, and this thread has taught me that quite a number of Nigerians who appear knowledgeable from their other posts, are actually quite ignorant. Yet, they will open their big mouths and start forming, gboa gboa!!

deenee:


Even with all these efforts, [b]over 70 percent of the Nigerian  populace is un banked [/b]and there is over 4.7 trillion Naira outside the banking system! BTW, I don't think your bank will 'close shop' or loose sleep if you, the originator of this thread decides to bury his 'money' or 'monies' (word coined for exclusively for this thread since poster deals in several foreign currencies!) in the ground . In fact , I think it will be the other way round!

This cash withdrawal limit directive by Sanusi will only make matters worse and will discourage people from banking their money.

Am sure that majority of the un banked population in Nigeria are illiterates. So how do you explain to such individuals (who have zero idea on what e-banking is, some cannot even append their signature on a withdrawal slip, instead they use their thumbprint). . . .  that they cannot withdraw more than 100k from their account in a day  Bear in mind that the level of illiteracy in Nigeria is really high  

It had to take a true Ijebu woman to knock some sense into your porous brains:

funkybaby:

OP, please which  bank is this?

And what is the customer to do if one requires to withdraw more than 100k? Give the bank 2weeks notice? 


it amazes me when we try to copy how things work in US or UK forgetting that their economy and level of development is way different from ours.

it might sound like a good initiative on sanusi's part but in my own opinion, the timing is wrong.

a country where power supply is epileptic. . . . i have had experiences of trying to withdraw money from an ATM machine only to discover that the machine has been powered off because there is no electricity in the premises.

what about the reoccurring issue of customers' accounts being debited with no cash dispensed at the ATM

a country where internet service is still below par. . . . . how can one rely on the internet for 'e-banking'

how many banks realistically operate intra-bank transfers in Nigeria without having to visit the banking hall. To the best of my knowlege, it is only GTB that currently provides that service and you need a ''token'' which is used to generate a unique number and bear in mind that you have to pay for the token. With all their noise about 'telephone banking', you cannot do an intrabank transfer by calling the GTCONNECT line without the ''token''.

there are other areas that sanusi should focus on such as outrageous/hidden bank charges, interest rates, loans to SMEs, exchange rate of the naira to other currencies, etc

@ Funkybabe, it's GTB o jare!

djustice:

It had to take a true Ijebu woman to knock some sense into your porous brains:

djustice:

@ Funkybabe, it's GTB o jare!

Really?
I find it absurd that they have to charge customers for the ''token'' or whatever its called.

I currently have a savings account with FCMB which i have not withdrawn from for close to 3years, yet i get monthly emails notifying me of my account balance, and i get charged witholding tax and sms alert (i have not used my naija mobile in ages). Why should i be charged ''withholding tax'' on a bloody savings account. 

I do recall that UBA customers incur a charge for withdrawing money from any branch of UBA other than the branch where the account is domiciled (i'm not sure if the bank still does this though). I would go mental if Lloyds was to charge me for withdrawing money at Bournemouth even though the account was originally opened at edinburgh. These are issues that Sanusi should look into rather than  trying to act like the Voltron of the banking sector which he's obviously not 

funkybaby:




Really?
I find it absurd that they have to charge customer for the ''token'' or whatever its called.

I currently have a savings account with FCMB which i have not withdrawn from for close to 3years, yet i get monthly emails notifying me of my account balance, and i get charged witholding tax and sms alert (i have not used my naija mobile in ages). Why should i be charged ''withholding tax'' on a bloody savings account. 

I do recall that UBA customers incur a charge for withdrawing money from any branch of UBA other than the branch where the account is domiciled (i'm not sure if the bank still does this though). I will go mental if Lloyds was to charge me for withdrawing money at Bournemouth even though the account was originally opened at edinburgh. These are issues that Sanusi should look into rather than trying to act like the Voltron of the banking sector which he's obviously not

The over-charging is nauseating. They find so many hitherto unknown headers to put the charges under, it's just surreal. A bank once charged me "counting fee" of about £700 for counting roughly N40m, that I was paying into my account with them!!! I just closed the account. They begged and begged, but I wasn't having it. I just wish more Nigerians would actually punish these banks by moving their money.

On the Voltron thing, Sanusi will vex o!! He REALLY does think he's the Defender of the Faith, an Islamic Voltron of sorts.

Why the limit on online transfers and card transactions? I thought the idea was to reduce cash in circulation not make transacting your business more difficult.

djustice:

The over-charging is nauseating. They find so many hitherto unknown headers to put the charges under, it's just surreal. A bank once charged me "counting fee" of about £700 for counting roughly N40m, that I was paying into my account with them!!! I just closed the account. They begged and begged, but I wasn't having it. I just wish more Nigerians would actually punish these banks by moving their money.

On the Voltron thing, Sanusi will vex o!! He REALLY does think he's the Defender of the Faith, an Islamic Voltron of sorts.

Man. We got your point. You are rich. But let me remind you that you are using a pseudonym. So, your vainglorious showoffs don't mean poo to anybody. We don't know who you are and don't care to know. you can put your money inside kolo.

Pay [b]£[/b]700 for [b]N[/b]40m. What happened to Counting fee in Nigerian currecny. . .

[b]Going cashless is superb but certain pre-cashless features has to be manifested.

Power supply has to be made stable.
IT greatly improved (I am sure we are a lot better than we were 5 years ago and we would get better in another 5 years time if we remain frankly determined and never cease to forget that Patience is key).
CBN should very well regulate our commercial banks so peeps wont just wake up one day to discover that their darling bank has folded-up and we all remember that NDIC hardly pay in full the to be refunded deposited amount in a failed bank.
Banks on their part should make the cashless option working and with little or no flaw to create a willing acceptance by the populace(Who no like better thing?).

When we get to the future where we remain greatly than where we are today then we can talk about a forced cashless transactions.
Let us not forget that more than 80% of what an average Nigerian spend money on daily can presently not be paid for online or via our proposes forced cashless option.

Rome was not built in a day oooOOO.[/b]

what happened to the uk economy?

Fact One:
Cost of cash to the Nigeria financial system is high and rising, N114 billion in 2009 and projected to reach N192 billion in 2012.  Jut to put this in context, the budget provisions for the Ministries of Power, Health, Education and Works in the 2011 budget are N90 billion, N257 billion, N356billion and N182 billion respectively.

Fact Two:
About 30 per cent of the physical space in bank branches, plus same fraction of employees are deployed to cash operations.  This means that a reduction in the cost of cash should achieve significant, direct impact on the aggregate cost of operation for all banks, including the CBN.

Fact Three:
Cost of banking services is typically recovered from the customers (in the form of COT, interest and charges on borrowings). This means that indeed the cash operations costs are currently apportioned to other customers and stakeholders of the bank.

Fact Four:
In Nigeria, over 99 per cent of customer activities in a typical bank branch are cash transactions, only 10 per cent of total number of cash transactions are above N150,000 but this 10 per cent accounts for about 70 per cent of total bank branch value of cash transactions.  Consequently, 10 per cent of customers that make high volume cash transactions impose the reported huge cost of cash operations on 90 per cent other customers.  Put differently, 90 per cent of bank customers (plus other stakeholders) are currently subsidising the cost of the heavy cash transactions generated by the 10 per cent of bank cash customers!

These are incontrovertible facts and we really need to reduce the cost of cash, not only on the banks but to CBN and in extension tax payers (which I believe most of us fall into this category)

mikewills:

Fact One:
Cost of cash to the Nigeria financial system is high and rising, N114 billion in 2009 and projected to reach N192 billion in 2012.  Jut to put this in context, the budget provisions for the Ministries of Power, Health, Education and Works in the 2011 budget are N90 billion, N257 billion, N356billion and N182 billion respectively.

Fact Two:
About 30 per cent of the physical space in bank branches, plus same fraction of employees are deployed to cash operations.  This means that a reduction in the cost of cash should achieve significant, direct impact on the aggregate cost of operation for all banks, including the CBN.

Fact Three:
Cost of banking services is typically recovered from the customers (in the form of COT, interest and charges on borrowings). This means that indeed the cash operations costs are currently apportioned to other customers and stakeholders of the bank.

Fact Four:
In Nigeria, over 99 per cent of customer activities in a typical bank branch are cash transactions, only 10 per cent of total number of cash transactions are above N150,000 but this 10 per cent accounts for about 70 per cent of total bank branch value of cash transactions.  Consequently, 10 per cent of customers that make high volume cash transactions impose the reported huge cost of cash operations on 90 per cent other customers.  Put differently, 90 per cent of bank customers (plus other stakeholders) are currently subsidising the cost of the heavy cash transactions generated by the 10 per cent of bank cash customers!

These are incontrovertible facts and we really need to reduce the cost of cash, not only on the banks but to CBN and in extension tax payers (which I believe most of us fall into this category)

THANK YOU GOD BLESS

FUNKY BABE, THE WHT ON YOUR SAVING IS TAX DEDUCTED ON THE INTEREST THAT HAS ACCRUED ON AMOUNT AVAILABLE IN YOUR ACCOUNT. IT IS NOT DEDUCTED FROM YOUR SAVINGS PER SAY BUT FROM THE INTEREST THAT THE BANK GIVES TO YOU WHICH IS REMITTED TO THE GOVT. AS FOR THE SMS ALERT, JUST NOTIFY THE BANK THAT YOU WANT THIS DEACTIVATED FROM YOUR ACCOUNT.

FINALLY, JUST TO ADD MY BIT, THERE IS ALSO THE INSURANCE PREMIUM THAT BANKS PAY FOR HOLDING 'EXCESS CASH ABOVE LIMIT', ALL OF WHICH ADD TO THE TOTAL OPERATING COST INCURRED

You people never keep crawling out of the woodwork with your sanctimonious yeyerisms.

mikewills:

Fact One:
Cost of cash to the Nigeria financial system is high and rising, N114 billion in 2009 and projected to reach N192 billion in 2012.  Jut to put this in context, the budget provisions for the Ministries of Power, Health, Education and Works in the 2011 budget are N90 billion, N257 billion, N356billion and N182 billion respectively.

When you say "cost of cash" are you talking about the cost of printing the money or of managing it?

Either way, you can quickly reduce the cost of printing by simply re-decimalising. Remove two zeros from the currency, and N1000, N500, N200 and N100 notes can be phased out immediately. You'll be left with N5, N10, N20 and N50 notes, which are now made from polymer, which is a more durable material than paper!

At the same time, you use coins more, an even more durable form of money. I daresay that once you've minted coins, your "re-minting" costs are negligible. Why do you think the "developed economies" you and your ilk are always so quick to refer to insist on using coins as part of their currency?


Fact Two:
About 30 per cent of the physical space in bank branches, plus same fraction of employees are deployed to cash operations.  This means that a reduction in the cost of cash should achieve significant, direct impact on the aggregate cost of operation for all banks, including the CBN.ac

Careful mate. You're talking about job losses here, which I believe are actually not necessary. I actually believe a drop in the operating cost of the CBN occasioned by the drop in the cost of making our money will be passed on to banks, who SHOULD pass on those CONSIDERABLE savings to their customers. This should automatically attract more customers to the banks, ergo, more business, ergo more jobs.


Fact Three:
Cost of banking services is typically recovered from the customers (in the form of COT, interest and charges on borrowings). This means that indeed the cash operations costs are currently apportioned to other customers and stakeholders of the bank.

Once again, my response to your "fact one" should result in my response to your "fact two", which of course is an overall reduction in all those headers you mentioned.


Fact Four:
In Nigeria, over 99 per cent of customer activities in a typical bank branch are cash transactions, only 10 per cent of total number of cash transactions are above N150,000 but this 10 per cent accounts for about 70 per cent of total bank branch value of cash transactions.  Consequently, 10 per cent of customers that make high volume cash transactions impose the reported huge cost of cash operations on 90 per cent other customers.  Put differently, 90 per cent of bank customers (plus other stakeholders) are currently subsidising the cost of the heavy cash transactions generated by the 10 per cent of bank cash customers!

Twaddle. You don't see the UK banks complaining that higher volume customers are making life difficult for their lower volume customers. They serve you with a smile and place NO LIMITS on the amount of money you can withdraw over the counter. They ask only that you tell them in advance if it's a lot of money. They will give you your cash with no extra charges if you do.

These are incontrovertible facts and we really need to reduce the cost of cash, not only on the banks but to CBN and in extension tax payers (which I believe most of us fall into this category)

Finally, I refer you once again to my response to your "fact one". Reduce the cost of making the currency by reducing the notes you have to mint by FOUR TYPES. Then you increase coins production, which you'll probably do a new issue once every 5 years or so.

Get the banks to sort out their appalling IT infrastructure, in close collaboration with the likes of Glo, 21st Century Telecoms and co, and you should see more savings. Finally, sort out the power problem, because a massive proportion of the costs of banking in Nigeria is accounted for by diesel consumption.

bouzymill2:

Man. We got your point. You are rich. But let me remind you that you are using a pseudonym. So, your vainglorious showoffs don't mean poo to anybody. We don't know who you are and don't care to know. you can put your money inside kolo.

Pay [b]£[/b]700 for [b]N[/b]40m. What happened to Counting fee in Nigerian currecny. . .

Oh boy, I taya for you o!!! So, because I related something that happened to me, I have offended you?? What is your problem gaaan na? Are you so stupid that you must contradict yourself I related this experience because I'm here anonymously. Nobody knows anyone, so how can I be showing off to people who don't know me?? Oya, go dat corner begin konk yourself for head, and don't stop until I tell you to.

On the £700, it was actually charged in Naira. However, I couldn't relate it in Naira back then, as I still lived more in the UK than Naija, so I had to do the conversion to appreciate the charge properly. It was actually over £700!

Don't forget to konk yourself o!

djustice:

You people never keep crawling out of the woodwork with your sanctimonious yeyerisms.

Your analysis is good but off point.

The poster refers to the cost of 'managing money'. When you want to give a well balanced opinion on  an issue like this, you need to approach it from a 'holistic' point of view. The cost of cash management is quite high and this is one of the reasons why currencies with higher denominations were  introduced in the first place, but apparently it has not solved the problem at hand. In fact let me ask you  one question you say that 'coins, N5, N10, N20 and N50 notes should be used whilst N1000, N500, N200 and N100 notes should phased out immediately', if you decide now, that you want to withdraw your '40 million that you were charged $700' for, and  you are paid in coins, N5, N10, N20 and N50 notes , will you be happy?


Secondly, I don't see how the cash limit suggested will bring about job losses. Have you heard of the term 'capacity under utilization'- if you go to most Nigerian banks, all you see is graduates who have been converted to note counters and bulk tellers counting cash every day! Even, If there are job losses as you have suggested ,please can you tell me the impact it will have on the economy (considering the fact that the poster had stated that only a minor proportion are involved in this).

At this point I will say that, you have mixed up the functions of the CBN  and  commercial banks in general- the former is in charge of printing money amongst other functions whilst the latter isn't. Let me also state that the limit on cash withdrawal was actually proposed by the banks in general and not the CBN, the CBN as the apex bank, regulator and lender of last resort just drew up the policy framework to guide the implementation of the whole process.

The poster is also correct, a significant proportion of the costs associated with managing cash and not 'printing or minting it' as misinterpreted  by you, is transferred to the customers and it is also true that, a tiny proportion of customers actually account for over 70% huge cash transactions  and I think that it is ludicrous that the cost of managing this is shared by all and sundry.


In addition, you have not even looked at the 'big picture' yet , I can confirm to you that there is currently a plan  for a 'consortium of banks' to build
an independent power station and hence creating alternative source of power for their bank wide operations. I also disagree with you when you say that the IT infrastructure used in the Nigerian banking system is poor, if you say there is a a power problem-yes but infrastructure in terms  of systems-no .On the contrary, the Nigerian banking system has one of the most robust IT platforms in the world. I have worked in 'managerial capacity' in Nigeria and presently abroad thus I can say without fear of doubt, that we are ahead in the aspect. The main challenge is to have constant power supply, to maximize potentials inherent to the fullest

FINALLY, JUST TO ADD MY BIT, THERE IS ALSO THE INSURANCE PREMIUM THAT BANKS PAY FOR HOLDING 'EXCESS CASH ABOVE LIMIT', ALL OF WHICH ADD TO THE TOTAL OPERATING COST INCURRED(cited from my last comment on this thread)

deenee:

FUNKY BABE, THE WHT ON YOUR SAVING IS TAX DEDUCTED ON THE INTEREST THAT HAS ACCRUED ON AMOUNT AVAILABLE IN YOUR ACCOUNT. IT IS NOT DEDUCTED FROM YOUR SAVINGS PER SAY BUT FROM THE INTEREST THAT THE BANK GIVES TO YOU WHICH IS REMITTED TO THE GOVT. AS FOR THE SMS ALERT, JUST NOTIFY THE BANK THAT YOU WANT THIS DEACTIVATED FROM YOUR ACCOUNT.

I have similiar savings account with other banks and none charges me witholding tax.

Besides, why such charges on an account that has gone dormant

As for the sms alert, i intend to take it up with them soon.

deenee:

On the contrary, the Nigerian banking system has one of the most robust IT platforms in the world. [/b]I have worked in 'managerial capacity' in Nigeria and presently abroad thus I can say without fear of doubt, that [b]we are ahead in the aspect.

I disagree. Ahead in werrin?

I use my Stanbic cash card on Intercontinental's ATM. I get instant debit alert (great) but no cash is dispensed.

I use my UBN cash card on Zenith's ATM. . . . Instant debit alert (i wish. . . sometimes i'm lucky tho) but no cash is dispensed.

I am no IT geek but i do understand that such inter bank transcations is handled via an IT platform. How come such confusion does not happen in other cournties which have the ''same robust IT platform'' as Nigeria according to you?

Besides, which bank in Nigeria has an 'e-banking' or 'on-line banking' platform/website that can compete with other major banks in the world

deenee:

The main challenge is to have constant power supply, to maximize potentials inherent to the fullest

shikena

@funkybaby
As long as you have a savings account, or any other type of account (fixed income or deposit account), that accrues interest on a monthly basis, you are liable to pay WHT. This said, I would like raise a valid point here. You have stated that the account is dormant and wonder why they still charge you WHT, hence, I have this question to ask, do you still receive interest ?( no matter how small). If the answer to the above question is YES, then, the bank reserves the right to deduct WHT from the interest accrued.

At this point I would like to include a CAVEAT, because you include that you have other savings accounts in other banks and yet, you are not charged WHT or so it seems? This is so for several reasons some of which I will explain below-

1)   First and foremost, I know that in all Nigerian banks, you lose the right to a monthly interest if you withdraw more than 3-5 times from your account in a month ( the limit applied varies hence, I have used a range of the low and highest frequency) This you can confirm from your bank(s). What this simply means, is that if you for example, transact with Bank A and the limit implied in this ‘context’ for their savings account is three per month, you will not be entitled to a monthly interest if you withdraw more than three times. Subsequently, if interest is not paid to you then there will be no basis for deducting WHT. So if your other saving accounts have been quite active (outflows exceeding the limits set by the banks where they are domiciled) then you won’t have any interest and no WHT deducted.

2) Secondly, banks in Nigeria use different banking software and applications. Some of which are programmed to deduct WHT ‘at source’ i.e. before net interest is credited to customers’ accounts on pro-rata (depending on amount held in the account for the month under review). Others prefer to credit total interest first and then deduct WHT individually from customer’s accounts for ‘audit trail purposes’. Either way the WHT is remitted back to the Govt periodically.

Finally, I still maintain my stance, that Nigeria banks have a robust IT platform but ability to maximize the potentials herein is hampered by a myriad of accentuating circumstances. Top of which is the lack of power supply, poorly trained human capital etc. I 'interned' as an associate with a full service global investment bank in America and was quite surprised that the IT platform they were using then was one that had been implemented way before I even left the shores of Nigeria to study abroad. 

For the failed  inter bank ATM withdrawals- the service is currently provided by only three vending operators- viz Interswitch, Valucard and Visa  and the level of traffic generated through the volume of daily transactions cannot be handled by then alone and you also have to consider the issue of power supply mentioned earlier. This was one of the reasons why CBN directed banks to remove all ‘off site’ ATMs (cash machines not located within bank premises). Presently, there are plans to get extra vending operators for this kind of service. I do know that we don’t have a perfect system but I can tell you that our banking model if, supported by all and sundry will be world class!

.

.

Are you completely silly, or you just like acting like a dimwit sometimes

deenee:



Your analysis is good but off point.

The poster refers to the cost of 'managing money'. When you want to give a well balanced opinion on  an issue like this, you need to approach it from a 'holistic' point of view. The cost of cash management is quite high and this is one of the reasons why currencies with higher denominations were  introduced in the first place, but apparently it has not solved the problem at hand. In fact let me ask you  one question you say that 'coins, N5, N10, N20 and N50 notes should be used whilst N1000, N500, N200 and N100 notes should phased out immediately', if you decide now, that you want to withdraw your '40 million that you were charged $700' for, and  you are paid in coins, N5, N10, N20 and N50 notes , will you be happy?


Secondly, I don't see how the cash limit suggested will bring about job losses. Have you heard of the term 'capacity under utilization'- if you go to most Nigerian banks, all you see is graduates who have been converted to note counters and bulk tellers counting cash every day! Even, If there are job losses as you have suggested ,please can you tell me the impact it will have on the economy (considering the fact that the poster had stated that only a minor proportion are involved in this).

At this point I will say that, you have mixed up the functions of the CBN  and  commercial banks in general- the former is in charge of printing money amongst other functions whilst the latter isn't. Let me also state that the limit on cash withdrawal was actually proposed by the banks in general and not the CBN, the CBN as the apex bank, regulator and lender of last resort just drew up the policy framework to guide the implementation of the whole process.

The poster is also correct, a significant proportion of the costs associated with managing cash and not 'printing or minting it' as misinterpreted  by you, is transferred to the customers and it is also true that, a tiny proportion of customers actually account for over 70% huge cash transactions  and I think that it is ludicrous that the cost of managing this is shared by all and sundry.


In addition, you have not even looked at the 'big picture' yet , I can confirm to you that there is currently a plan  for a 'consortium of banks' to build
an independent power station and hence creating alternative source of power for their bank wide operations. I also disagree with you when you say that the IT infrastructure used in the Nigerian banking system is poor, if you say there is a a power problem-yes but infrastructure in terms  of systems-no .On the contrary, the Nigerian banking system has one of the most robust IT platforms in the world. I have worked in 'managerial capacity' in Nigeria and presently abroad thus I can say without fear of doubt, that we are ahead in the aspect. The main challenge is to have constant power supply, to maximize potentials inherent to the fullest

FINALLY, JUST TO ADD MY BIT, THERE IS ALSO THE INSURANCE PREMIUM THAT BANKS PAY FOR HOLDING 'EXCESS CASH ABOVE LIMIT', ALL OF WHICH ADD TO THE TOTAL OPERATING COST INCURRED(cited from my last comment on this thread)

Either that, or you're a complete illiterate, hiding behind big words to sound intelligent, or just plain blind! Read my post below, and slap yourself twice for that tripe you wrote, bolded and in red up there!!

Fact One:
Cost of cash to the Nigeria financial system is high and rising, N114 billion in 2009 and projected to reach N192 billion in 2012.  Jut to put this in context, the budget provisions for the Ministries of Power, Health, Education and Works in the 2011 budget are N90 billion, N257 billion, N356billion and N182 billion respectively.

When you say "cost of cash" are you talking about the cost of printing the money or of managing it?

Either way, [b][size=16pt]you can quickly reduce the cost of printing by simply re-decimalising. Remove two zeros from the currency, and N1000, N500, N200 and N100 notes can be phased out immediately.[/size] [/b]You'll be left with N5, N10, N20 and N50 notes, which are now made from polymer, which is a more durable material than paper!

At the same time, you use coins more, an even more durable form of money. I daresay that once you've minted coins, your "re-minting" costs are negligible. Why do you think the "developed economies" you and your ilk are always so quick to refer to insist on using coins as part of their currency?

The above means that my N40m would have been N400,000 only. In N50 notes, we would have needed to count just 80 bundles of N50 bundles. Geddit? I paid the money into my account with the same bank is my problem. I brought it in in forex, and to pay it in, because I didn't have a dom account, I had to change it to pay it into my account at the same bank. The bank people called the mallam that changed the money. The £700 was charged for counting the money prior to paying it into my account with them. That's what I didn't get. They were charging me for inflow!!!
Now that you've hopefully seen what I posted, can you kindly quit posting on this thread if you insist on inflicting your stupidity on us all?

First and foremost, I don't need to engage in a 'war of words' with you or use 'abusive language' because frankly speaking, there are certain attitudes that one outgrows and for me,  this falls within the category of such. Also, I personally think that it is a waste of my time and also, space on this thread. So, I will reply stating my take on the above subject manner in a civilized manner.

Secondly, you say that money should be re-decimalized, by removing the zeros and hence eradicating currencies in large denominations.This is easier said than done and has no relevance to the issue at hand( I still cannot see the 'analogy' between this and cash withdrawal limits?). Have you thought of the impact that this 'suggestion' will have on the marco economy at large? What about the fiscal and monetary implications? Re-decimalization of currency either by devaluing it  (which is akin to what you have put forward) or otherwise has far more reaching implications on the economy of the country than just making  huge cash based transactions easy for a few minority.

Nigeria, is an import-oriented economy and this idea you have suggested can only be implemented if it is backed by real growth ( i.e manufacturing). Countries that devalue their currencies are those that have real factors of production contributing to the growth of the economy (e.g China) and there is a limit to which this can be done so that the intended effects don't back fire! Also, the imbalance caused by huge 'capital flight' and trade deficits in international payments in Nigeria cannot sustain it.

Finally, I will refer you back to my post where I have commented  that the point you raised has to be addressed from a 'holistic' point of view (i.e look at the marco and mirco-economic implications and impact it will have on the Nigerian economy now and in the long run)

Thank you.

Charm lies in the unsaid, the unwritten, and the undisplayed. It takes mastery to control silence.

deenee:

Charm lies in the unsaid, the unwritten, and the undisplayed. It takes mastery to control silence.

Word!

deenee:

First and foremost, I don't need to engage in a 'war of words' with you or use 'abusive language' because frankly speaking, there are certain attitudes that one outgrows and for me,  this falls within the category of such. Also, I personally think that it is a waste of my time and also, space on this thread. So, I will reply stating my take on the above subject manner in a civilized manner.

Secondly, you say that money should be re-decimalized, by removing the zeros and hence eradicating currencies in large denominations.This is easier said than done and has no relevance to the issue at hand( I still cannot see the 'analogy' between this and cash withdrawal limits?). Have you thought of the impact that this 'suggestion' will have on the marco economy at large? What about the fiscal and monetary implications? Re-decimalization of currency either by devaluing it  (which is akin to what you have put forward) or otherwise has far more reaching implications on the economy of the country than just making  huge cash based transactions easy for a few minority.

Nigeria, is an import-oriented economy and this idea you have suggested can only be implemented if it is backed by real growth ( i.e manufacturing). Countries that devalue their currencies are those that have real factors of production contributing to the growth of the economy (e.g China) and there is a limit to which this can be done so that the intended effects don't back fire! Also, the imbalance caused by huge 'capital flight' and trade deficits in international payments in Nigeria cannot sustain it.

Finally, I will refer you back to my post where I have commented  that the point you raised has to be addressed from a 'holistic' point of view (i.e look at the marco and mirco-economic implications and impact it will have on the Nigerian economy now and in the long run)

Thank you.

Charm lies in the unsaid, the unwritten, and the undisplayed. It takes mastery to control silence.

Feel free to claim the moral high ground. I reserve the right to use whatever language I choose in this discussion, in particular with you, since you first
headed in that direction.

Now, as to your ill-thought out opinion that removing a couple of zeros from our currency is somehow difficult or "has no relevance to the issue at hand",  I refer you to Ghana on the difficulty issue.

As to your inability to see the "analogy" between this and cash withdrawal limits, that just betrays your myopia, doesn't it? The chief excuse given by Sanusi and his defenders, yourself included, for the cash withdrawal limits, is your ill-considered rush to an e-cash economy, based principally on the cost of managing our currency to the CBN and by extension the banks.

"Management" in this context would refer to the withdrawal of decrepit notes, and minting of new ones, as well as the cost of counting, storing and transporting the physical cash. It stands to reason, if you think about it SLOWLY, in case I'm moving too fast for you and Sanusi, that if you actually implement a policy whereby you reduce the number of categories of notes you need to print from 8 to 4 types of notes, you reduce the cost of producing the money by something approaching 50%!! Not good enough for you??

Moreover, by focusing on using the polymer notes, which do seem to be more durable than the paper notes, you reduce the FREQUENCY of re-minting.

There is also the question of the people's fundamental human right to carry on business as enshrined in the constitution. That is going to be defended in the courts, and as you can see, litigation has already begun, with a group of villages in Delta state, dragging the CBN to court for infringing on their rights with that policy. Sanusi is unhappy with the cost of banking. He wants to add the cost of all that expensive litigation to the huge costs we the banking public already pay.

Who talked about devaluation Man, you really try my patience. My friend, all I said was RE-DECIMALISATION. The value of the money as against foreign currency does not change. Only the face value internally changes. N100 becomes N1, and where N165 bought one USD, N1.65 will now buy it. How on earth is that devaluation

Moreover, 1 USD will still buy the same amount of Nigerian goods or services it bought before re-decimalisation. DO YOU NOW UNDERSTAND

Wo, I'm fed up of chatting with you bo! You're giving me a headache, just like the moronic bankers I encounter every day. I'm sure you're a Nigerian Banker by profession!

funkybaby:

I have similiar savings account with other banks and none charges me witholding tax.

Besides, why such charges on an account that has gone dormant

As for the sms alert, i intend to take it up with them soon.


I disagree. Ahead in werrin?

I use my Stanbic cash card on Intercontinental's ATM. I get instant debit alert (great) but no cash is dispensed.

I use my UBN cash card on Zenith's ATM. . . . Instant debit alert (i wish. . . sometimes i'm lucky tho) but no cash is dispensed.

I am no IT geek but i do understand that such inter bank transcations is handled via an IT platform. How come such confusion does not happen in other cournties which have the ''same robust IT platform'' as Nigeria according to you?

Besides, which bank in Nigeria has an 'e-banking' or 'on-line banking' platform/website that can compete with other major banks in the world



shikena

Funkybaby, you dey mind this Mallam?

Deenee, Nigerian banks are ahead of developed nations in IT infrastructure Don't make me laugh!!! Back in 2001, Barclays Bank had emulated the large building societies, notably Abbey National, by rolling out Oracle Financials across their branches to connect them for instant transactions, and had been like that for a few years already, and were upgrading to Oracle Financials 11i, and I helped train some of their staff on the at least 3 of its modules. At that time, Nigerian banks were not even connected to their branches yet.

My friend, security-wise sef, the Nigerian banks don't even know the first thing about ATM security or IT security in general. Their staff just pretty much do what they like with customer data. Nothing like Data Protection behaviour, even if there is no Data Protection Act yet. Not only that, their systems are so insecure, that people can clone checks (that's been done to me before) and collect. Everything is just porous, like a sieve. Their card systems are so terrible, I refused to obtain a Nigerian VISA card for a long time, and only took one recently from a bank whose systems I had checked out. There are only two of them with near enough IT systems security to pre-2000 UK standards.

Thank you, you can call me whatever you like, no stress with that. However, it is still expedient that certain points are made clear.

'Cash Management' as you have referred to here, encompasses the cost of handling cash related transactions (processing , storing, insurance premium paid to hold 'excess over limit' and other indirect costs) and is borne by the bank not the CBN. Banks don't print or 'mint' money, the CBN does. Also, printing of money is not in any way part of cash management and the CBN does not in any way transfer this cost to banks nor their customers. This is used as a monetary policy tool to control the supply of money and targeting rates of interest for the purpose of promoting economic growth and stability. So the analogy is still very unclear and with a lot in discrepant inconsistencies.

The cash withdrawal limit has nothing to do with the amount of money in circulation or value of money per say. It is also not going to affect the value of basket of goods sold in Nigeria vis-a-vis the exchange rate. So, for you to say that, 'only the face value will change i.e. N100 becomes N1, and where N165 bought one USD, N1.65 will now buy it', is intrinsically incorrect. If the CBN feels that there is excess supply of money, treasury bills are sold as OMOs(open market securities) to FIs( financial institutions) to mop up cash and if the supply of money is short, the opposite is done which in turn have corresponding impacts on inflation and interest rates. The new policy is a cost cutting measure proposed by banks to help reduce overhead and operational cost of doing business.

You still talk of re-decimilization, there is no way, this can be done in Nigeria at least for now, in an economy where the 'real' value of our currency is tied to the goods and services manufactured in another country and imported in our country using a foreign currency as a medium of exchange. Simply put, Britain or America didn't just simply knock off some 'zeros' from their currency or 'reduce the number of notes printed from 8 to 4' without stable macro economic factors. Without, a thriving or break even manufacturing sector and at least a 'fair balance' in international trade between Nigeria and other countries, our currency will still be subject to the dictates of other currencies. If 'reminting' money by 'adding or removing zeros' from it does not affect the value of the currency in anyway, then, countries like Zimbabwe and Ghana should be 'super economies' by now! In fact Nigerian still has a higher GDP and GNP than Ghana even with the huge capital flight witnessed daily, in our country!

I still maintain that the IT platform is robust and 'not ahead' because of a myriad of accentuating factors and is plagued with challenges More so, cheque cloning is a very common thing everywhere,( Nigeria, UK and US inclusive). Finally, the level of fraud committed in the countries you have mentioned above where their 'system is not porous' is more than, that witnessed in Nigeria.


Thank you once again!

I give up. Calling you stupid is not an insult after all.