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CORRECTION: Cash deposit into domiciliary accout can only be withdrawn over the counter

The Central Bank of Nigeria (CBN) has restricted the process of cash withdrawal of electronic transfer deposits made into domiciliary accounts

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CBN treasury, domiciliary account

The Central Bank of Nigeria (CBN) has stated that only cash deposit into domiciliary account can be withdrawn over the counter and not through electronic transfer.

The apex bank disclosed in a tweet, stating that deposits made through electronic transfers into domiciliary accounts can only be transferred but cannot be withdrawn as cash over the counter.

The CBN added that cash deposits also made into domiciliary accounts can only be withdrawn as cash over the counter and not transferred out of the domiciliary account.

The CBN tweet said “Only transfers into domiciliary accounts can be transferred from such accounts while cash deposits into such accounts can only be withdrawn in cash.”

Meanwhile, the tweet was made in response to speculation that the apex regulator in Nigeria had banned the acceptance of foreign currency as cash deposits in Deposit Money Banks (DMBs).

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READ MORE: LCCI reacts to CBN’s new cashless policy, says time frame is disruptive

The CBN denied that it had given any such directive to the DMBs operating within the country and any information contrary to this is false.

The CBN tweet said “The CBN has not prohibited acceptance of foreign currency as cash deposits by DMBs. Rumors to the contrary are false”

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What this means: If a bank customer made an electronic transfer of $5,000 into his domiciliary account and later goes to the bank to make a cash deposit of $10,000, making a total of $15,000 in the account. Such customer can only make withdrawals from the account in the manner/medium he used to make the deposits into the domiciliary account.

It means if the bank customer needs to make a payment of $12,000 or initiates a transaction of $12,000, he can only pay $5, 000 through electronic transfer and the reaming $7,000 would have to be paid in cash.

READ ALSO: Lafarge approves the sale of its South African Subsidiary for $316 million

The new CBN directive comes as a surprise to Nigerians as shown in their responses to the tweets on Saturday.

UPDATE:  We appreciate our readers that called our attention to error in the headline of the article published earlier. The error, which is regretted, has been rectified and corrections effected.

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5 Comments

5 Comments

  1. Agu Ezetah

    February 24, 2020 at 10:07 am

    Policy decisions like this are ok if they will be enforced across the board. However where you create this kind of blockage, you open door for foreign currency merchants who have access to the powers that be, to have their business to flourish illegally. Lots of honest business men have been duped large sums of money by these scam foreign exchange dealers. This is another policy that is put in to help the friends of the appointors of this CBN man. How can he not know that unnecessary blockage in supply is boom policy for smuggling. It is difficult to believe this man graduated from UNN when you look at the policies he churns out. Very bad decision.

  2. Atowarifagha

    February 25, 2020 at 9:39 am

    This is the kind of unnecessary, thoughtless intervention that drove the value of the dollar to over five hundred Naira before it settled at three hundred and sixty. Why can’t these people let us be?

  3. Mgbaram

    February 25, 2020 at 5:08 pm

    I am just too tired of this policies CBN always forcefully impose on us

  4. Chidi

    February 25, 2020 at 5:11 pm

    Does this people even consider us before making such policies

  5. aninymous

    May 20, 2020 at 7:12 pm

    i laugh in spanish and cough in zulu.. How could you do such a things that will trigger a mad rush on usd. Commons Sense: Forces of Demand. This will cause usd scarcity (arificial or natural), that will in turn rise the demand of usd, and then the usd value rises..while own Ngn is ridiculed with further devaluation and ‘trash-can’ gesture. Please stop it! i beg of you.. This is not taking us anywhere rather its making our labour, and economic efforts valueless on the globe. How do we compete globally if we don’t have good purchasing power.. This is so ridiculous.

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Financial Services

CBN grants Mortgage Refinancing Companies approval to refinance Non-member banks

The CBN has expanded access to mortgage financing by removing restrictions on refinancing mortgages earlier imposed.

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P&ID dispute: UK Court orders $200 million guarantee to FG, Leaked letter by Poultry Farmers Association triggered CBN emergency approval to import maize, nImplications of CBN's latest devaluation and FX unification, current account deficit, IMF, COVID-19, CBN OMO ban could give stocks a much-needed boost , CBN’s N132.56 billion T-bills auction records oversubscription by 327% , Nigeria pays $1.09 billion to service external debt in 9 months , Implications of the new CBN stance on treasury bill sale to individuals, Digital technology and blockchain altering conventional banking models - Emefiele  , Increasing food prices might erase chances of CBN cutting interest rate   , Customer complaint against excess/unauthorized charges hits 1, 612 - CBN , CBN moves to reduce cassava derivatives import worth $600 million  , Invest in infrastructural development - CBN Governor admonishes investors , Credit to government declines, as Credit to private sector hits N25.8 trillion, CBN sets N10 billion minimum capital for Mortgage firms, CBN sets N10 billion minimum capital for Mortgage firms , Why you should be worried about the latest drop in external reserves, CBN, Alert: CBN issues N847.4 billion treasury bills for Q1 2020 , PMI: Nigeria’s manufacturing sector gains momentum in November, CBN warns high foreign credits could collapse Nigeria’s economy, predicts high poverty, MPC Member, BVN, Fitch, Foreign excchange (Forex), Overnight rates crash after CBN’s N1.4 trillion deduction, Nigeria’s foreign reserves hit $36.57 billion; Emefiele keeps his word on defending the naira, CBN to support maize farmers, projects 12.5 million metric tons in 18 months, BREAKING: CBN Upscales Greenwich Trust Limited, grants it's operational license for merchant banking, AGSMEIS: CBN expand beneficiaries to 14,638., CBN expands access to mortgage financing

The Central Bank of Nigeria (CBN), has granted approval to Mortgage Refinancing Companies (MRC), to re-finance non-member banks.

This is contained in a circular referenced FPR/DIR/GEN/CIR/07/056 and signed by Ibrahim Tukur, the Director of Financial Policy and Regulation Department, CBN.

The circular improved on the earlier provisions contained in section 7.3.1.5 which states that “A mortgage refinance company (MRC) shall not, without the prior approval of the CBN, extend total outstanding credit to any single borrower, which is equal to or more than twenty times the value of the borrower’s shares with the MRC or 25 percent of its shareholders’ funds unimpaired by losses.”

READ MORE: Unity bank wants to be seen, but time is running low

READ: NFF receives $1 million from FIFA as COVID-19 palliative

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What this means

Based on the provisions contained in the latest circular, MRCs are now free and legally permitted to refinance the qualifying mortgages of banks and all other non-members ( that do not hold equity), subject to meeting all other relevant requirements specified in the framework.

In a nutshell, the restriction on non-member mortgage lenders from refinancing their mortgages with MRCs has been removed.

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READ: MFBs, DMBs, others get new lending limit directive from CBN

Why this matters

Prior to the provisions contained in the latest circular, CBN had expressed fears that provisions of section 7.3.1.5 negatively impacts the mortgages sub-sector, as it constrains the MRCS from refinancing the mortgages of non-shareholder banks. Therefore, the new order will help to remove the restrictions already highlighted.

In lieu of this, the latest circular stated that the provision of section 7.3.1 5 is hereby revised to “the MRC shall not, without prior approval of the CBN, extend total outstanding credit to any single borrower, which is equal to or more than 25 percent of its shareholders’ funds unimpaired by losses,” the circular reads.

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Business News

Nascon Allied Industries Plc: Increase in sale of goods boosts revenues

Nascon Allied Industries Plc recorded a boost from an increase in the sale of goods revenue-generating unit

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Nascon Allied Industries Plc: Increase in sale of goods boosts revenues

Nascon Allied Industries Plc recorded a boost from an increase in the sale of goods revenue-generating units, as total revenues increased slightly. The company reported revenues of N21.87 billion in 2020 (9months) – 4.01% increase compared to N21.03 billion in the corresponding period of 2019.

READ: Focus on Aluminium Extrusion Industries Plc and its declining 2019 performance

What you should know

Key highlights from 2020 (9months) results

  • Revenues increased by 4.01% from N21.03 billion to N21.87 billion YoY.
  • Revenues from sale of edible, refined, bulk grade salt; seasoning and vegetable oil, increased to N21.87 billion, +22.53% YoY.
  • Other income increased to N12.81 million, +27.43% YoY.
  • No revenue was recorded for freight income on the deliveries of salt and seasoning income-generating unit.
  • Gross profit increased to N8.96 billion, +74.56% YoY.
  • Operating profit increased to N3.64 billion +18.60% YoY.
  • Pre-tax profits increased to N3.47 billion, +16.63% YoY.
  • Post-tax profits increased to N2.29 billion, +13.27% YoY.
  • Earnings Per Share increased to 115 kobo, +12.75% YoY
  • Total assets increased to N44.36 billion, +45.79% YoY.
  • Total liabilities increased to N32.04 billion, +67.21% YoY.
  • Total equity increased to N12.32 billion, +9.35% YoY.

(READ MORE:Dangote’s NASCON Allied Industries Plc moves operation from Apapa)

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Bottomline

Nascon Allied Industries Plc recorded a boost from increase in sale of goods revenue-generating unit, but no revenue was recorded for its freight income on the deliveries of salt and seasoning revenue generating-unit.

READ: Food, Agro & Allied Industries set to export agri-products to New Zealand

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Though companies have generally recorded decreased revenues in the last three quarters, mostly due to COVID-19; Nascon Allied Industries Plc was able to increase its total revenues and pre-tax profits in the period under consideration.

READ: Nigeria Air: Domain name registration and N48 million controversy!

 

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Tech News

Instagram disables its “Recent” feature

Instagram recently announced it had removed the “recent” tab from hashtag pages on a temporary basis

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COVID-19: Instagram cracks down on coronavirus AR effects, Instagram Tenders apology for fagging #EndSARS fake, Instagram has disabled the “Recent” feature for the forthcoming U.S election,

Instagram disclosed that it would remove the “Recent” tab from its hashtag pages for people in the United States of America.

The social networking and video sharing service stated this on its official Twitter handle. It said it is “doing this to reduce the real-time spread of potentially harmful content that could pop up around the election.”

What you should know

Nairametrics had reported on Instagram’s apology for its algorithm malfunction that led to the flagging of #EndSARS posts as fake.

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Instagram has also taken the following measures to ensure a successful November election.

  • The registration of 4.4 million votes this year through its flagship platform – Instagram and Messenger.
  • Serving as a means of information and tool to people in the US on the electoral process
  • The ban of any content that can thwart the success of the election.

(READ MORE:U.S dollar stable amid U.S holiday)

Mark Zuckerberg, the CEO of Facebook, said he was perturbed about the high risks for civil unrest in the US due to the upcoming presidential election.

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“I’m worried that with our nation so divided and election results potentially taking days or weeks to be finalized, there is a risk of civil unrest across the country.”

Furthermore, he disclosed on a call while discussing Facebook’s Q3 earnings, that “given this, companies like ours need to go well beyond what we’ve done before.”

Why this matters

The aim of the short-term decision is to decrease the spread of misinformation in the forthcoming US election.

 

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