The new withdrawal limit: Is it the beginning of the end for liquidity in Lebanon?

In a new step reflecting the severity of the financial crisis in Lebanon, the Central Bank of Lebanon issued an official statement imposing additional restrictions on cash withdrawals for April 2025, in an attempt to curb the exchange rate deterioration and regulate liquidity in the markets. The decision, part of a strict monetary policy, includes specific limits on dollar withdrawals, regulation of withdrawals in Lebanese pounds, and tightening transfers between bank accounts, with limited exceptions for certain necessary cases. The new measures will impact citizens' daily lives, as reduced liquidity is expected to slow down commercial activities and increase reliance on the black market, widening the gap between the official dollar rate and the parallel rate. Small depositors relying on their savings in banks will face additional challenges in securing their basic needs, while investors and business owners will need to seek alternative solutions to secure the necessary liquidity to sustain their activities. Faced with these challenges, citizens find themselves forced to adapt to the new financial reality by relying more on electronic payment methods, exploring non-traditional banking options, and developing more cautious financial strategies to cope with ongoing fluctuations. With the continued strict restrictions, depositors remain vigilant for any possible adjustments to these measures, hoping for solutions that allow them to regain the freedom to manage their funds without suffocating constraints.