Naira Redesign: Banks’ cash withdrawal limit is illegal, says Supreme Court
The Supreme Court has ruled that the cash withdrawal limits imposed by banks as a result of scarcity of currency notes in circulation is a violation of citizens’ rights, stressing that such restriction on an owner’s right to freely use his or her property is illegal unless provided for by a law.
Penpushing reports that Justice John Okoro who led a seven-man panel of the court made the declaration in a unanimous judgement delivered on Friday in a suit challenging the Nigerian government’s illegal withdrawal of the old N200, N500, and N1,000 from circulation.
The Supreme Court declared that such action by the commercial banks as a violation of the rights of the citizens, adding that it was not aware of any law that permits the Central Bank of Nigeria (CBN) to direct the imposition of limits on the cash to be paid from a customer’s account after deposit of the old naira notes
“My attention has not been drawn to any law that permits a bank not to pay cash to a customer on demand on the grounds that the 1st defendant has not been able to print enough new naira notes’, the court said.
“To the extent that the directive has continued to deprive all persons and the plaintiffs’ access to a substantial part of their funds in banks in form of cash, it forcefully and illegally interferes with their rights of ownership and use of their said funds for. Such restriction on an owner’s right to freely use his or her property is illegal unless provided for by a law.”
Penpushing further reports that in similar vein, the Supreme Court nullified President Muhammadu Buhari’s directive withdrawing the old N200, N500, and N1,0000 notes from circulation, and also ordered that the old naira notes would remain legal tender and must continue to circulate alongside the new ones up till 31 December, 2023.
The Supreme Court through a member of the panel, Justice Emmanuel Agim emphasized in the judgement that such restriction on an owner’s right to freely use his or her property is illegal unless provided for by a law
Penpushing also reports that it is recalled that the Nigerian government, under a demonetisation policy, had in October 2022, introduced newly redesigned N200, N500, and N1, 000 notes and aimed to withdraw the old versions of the currency notes from circulation within 90 days.
The Central Bank of Nigeria (CBN) under the policy equally placed cash withdrawal limits of maximum of N500,000 weekly on individuals and maximum N5 million weekly on corporate entities, a development which has continued to cause hardship on the citizens of the country.
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