January 8, 2023
In an effort to crack down on government fraud and encourage the use of the country's digital currency, Nigeria has banned cash withdrawals from government accounts starting March 1, 2023.
In a January 2022 report by the government's Nigerian Financial Intelligence Unit (NFIU), corruption in public office has become "incessant" with public funds being misappropriated for the use of bribes, private gain or party financing. In the country's justice system N9.457 billion ($22,898,859.54) in bribes, demanded by court officials and judges, have been paid by lawyers and litigants. In 2019, over N675 billion ($1,634,422,140 USD) was used to bribe public officials, a number comprising over 50% of the country's Gross Domestic Product.
In December 2022, The Central Bank of Nigeria also limited cash withdrawals of up to $225 per week, a decrease from previous limits. Any amounts withdrawn over the limited amount would be hit with a 5% penalty. Regulations related to bank deposits and third party cheques were also affected, with the new rules taking effect on January 9, 2023.
The move was made to encourage individuals and businesses to start using the central bank's digital currency eNaira. The cryptocurrency was launched in October 2021 and is backed by the sovereignty of Nigeria but has been slow in adoption by the public.
Many countries are implementing cryptocurrency as legal tender. Last month, Brazil's President Jair Bolsonaro signed a bill allowing the use of cryptocurrency as a method of payment under government regulation.
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