The Central Bank of Nigeria (CBN) has launched an investigation into commercial banks over allegations that customers are being prevented from accessing funds in their domiciliary accounts. According to a source close to the apex bank, several complaints have been received from customers who have been unable to withdraw cash from their foreign currency accounts despite meeting the required conditions. The CBN is working on measures to stop banks from placing unnecessary restrictions on legitimate withdrawals.
The investigation was sparked by reports that some banks are using various methods to limit withdrawals from domiciliary accounts. Checks at some banks in Lagos revealed that the practice exists in different forms, with customers in other parts of the country also reporting similar experiences. Some banks reportedly place limits on the amount of foreign currency a customer can withdraw at once, while others claim that US dollars or British pounds are not available.
In some cases, customers are offered only lower denominations, such as $20 notes, which some believe is intended to discourage them from completing their withdrawals. One customer, who spoke anonymously, said the situation allows banks to appear to follow CBN rules while making it difficult for customers to access their own funds. This has raised concerns about the banks' practices and their impact on customers.
Instances of restricted withdrawals were reported at various banks. A reporter who visited an old generation bank and requested to withdraw $5,000 was told that only $3,000 could be made available. The teller was unable to confirm whether the remaining amount would be available the following day. At another new generation bank, a teller said dollars were not available but advised the customer to continue checking back.
Some customers suspect that available foreign currency is being reserved for preferred customers. A customer at a new generation bank reported that a friend had recently withdrawn $4,000 from the bank. At another bank on Victoria Island, Lagos, a customer who had just withdrawn $1,000 said that was the maximum amount available for over-the-counter withdrawal, attributing the restriction to a shortage of foreign currency cash.
Banking sources also revealed that some banks may be using available foreign currency cash for other transactions instead of releasing it to customers who want to withdraw their funds. This practice has led to complaints from customers who are unable to access their legitimate funds. The CBN's planned action is expected to address these complaints and ensure that customers can access their funds without unnecessary restrictions.
The CBN is expected to issue a circular directing banks to stop practices that delay or restrict customers from withdrawing their money. The circular will also direct banks to review their current practices and process legitimate withdrawal requests without unnecessary delays. This move aims to resolve the issue and ensure that customers can access their funds easily.
Key points
- The CBN is investigating commercial banks over complaints of restricted access to domiciliary accounts.
- Some banks are using various methods to limit withdrawals from domiciliary accounts.
- The CBN is expected to issue a circular directing banks to stop restricting withdrawals.
