Ethiopia’s central bank starts limiting cash withdrawals

Ethiopia’s central bank has issued a directive that limits cash withdrawals for individuals and businesses.

It said the move was designed to prevent tax evasion and encourage people to use cash in a more efficient way.

Under the new directive, individuals will no longer be allowed to withdraw more than 200,000 birr ($29,000) at any one time.

Business withdrawals still remain relatively high at close to $8,000 a day or $74,000 a month.

The central bank’s governor, Yinager Dessie, said the new rules will help manage liquidity for financial institutions, and those that break them will be penalised.

Ethiopia has a very cash-heavy economy, so it is thought the move will impact small businesses as they look to adjust to the new measures.

The timing of the announcement has been criticised by some as the country grapples with the economic impact of the coronavirus.

[Photo: Getty Images]