The Central Bank of Nigeria is investigating complaints that some commercial banks are restricting customers’ access to foreign currencies held in their domiciliary accounts.
The complaints centre on alleged limits on cash withdrawals, claims of dollar and pound shortages, and practices that customers say make it difficult to access legitimate funds in their accounts.
A source close to the apex bank told Financial Vanguard that the CBN had received several complaints from customers and was preparing measures to address the situation.
According to the source, the complaints involve “practices and arrangements that may impede the timely and convenient fulfilment of legitimate withdrawal requests.”
The CBN is expected to direct banks to honour legitimate withdrawal requests and review practices that unnecessarily restrict or delay customers seeking to withdraw foreign currency from their domiciliary accounts.
The source said a circular could be issued to banks shortly, directing them to stop practices that could create unnecessary difficulties for customers or give the impression of distress within the banking system.
The development followed complaints from customers in Lagos and other parts of the country who said banks had adopted different approaches to limiting foreign currency withdrawals.
While some customers reported being given transaction limits, others said they were told that US dollars or British pounds were unavailable. Some banks, according to customers, offered only lower denominations.
In one case, a customer seeking to withdraw $5,000 from an old-generation bank was reportedly told that the bank could dispense only $3,000. The teller also expressed uncertainty over whether the customer would be able to obtain the full $3,000 on a subsequent visit.
At another new-generation bank, a teller reportedly told a customer that US dollars were unavailable and advised the customer to keep checking back.
A customer who received a similar response claimed that other customers were still obtaining dollars from the same bank.
At another bank in Victoria Island, Lagos, a teller reportedly said dollars were unavailable, while a customer said he had just withdrawn $1,000. The customer claimed that $1,000 was the maximum amount available for over-the-counter dollar withdrawals at the branch.
Customers said the varying responses had fuelled concerns over how banks were allocating the limited foreign currency cash available to them.
A source close to the CBN said some of the practices were unacceptable, particularly where customers had met the applicable requirements for withdrawing funds from their domiciliary accounts.
“They know what they are doing. They know that CBN would frown at their illegal withholding of customers’ foreign currency,” the source said.
The source alleged that some banks could be offering customers denominations that make it difficult for them to proceed with withdrawals, potentially allowing the institutions to claim that they had made the funds available.
Meanwhile, banking industry sources alleged that some banks could be using available foreign currency cash for other transactions rather than releasing it to customers who request withdrawals.
The sources claimed that such activities could generate additional earnings for the banks.
However, the allegations have not been independently established.
The CBN’s planned intervention is expected to focus on ensuring that legitimate domiciliary account holders can access their foreign currency deposits without unnecessary restrictions or delays, subject to existing banking requirements.
The development comes amid heightened scrutiny of foreign exchange operations in the banking sector and growing complaints from customers over access to foreign currency cash.
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