The Central Bank of Nigeria (CBN) has issued a stern warning to Deposit Money Banks (DMBs) against engaging in activities that could hinder the smooth flow of cash during the upcoming Yuletide season.
In a circular signed by Solaja, Mohammed J. Olayemi, Acting Director of the Currency Operations Department, the CBN stressed the need for responsible cash distribution and prevention of Naira abuse.
To ensure compliance, the CBN said it would intensify its monitoring efforts through spot checks and mystery shopping activities, conducted in collaboration with law enforcement agencies.
DMBs have been advised to implement robust internal controls to account for the disbursement of mint banknotes at their outlets.
The CBN has also encouraged banks to prioritize cash distribution through ATMs to enhance public access to cash.
To this end, any bank found to be hoarding cash, diverting funds, or violating the Clean Note Policy will face severe penalties.
Furthermore, DMBs will be penalized for any cash seized from ‘hawkers’ that can be traced back to their withdrawals. The initial penalty will be 10 percent of the total value of the withdrawn cash, with subsequent offenses incurring incremental penalties of 5 percent.
The CBN’s initiatives aim to curb the practice of “hawking” Naira notes, which often leads to abuse and damage to the currency.
By promoting responsible cash distribution and discouraging unethical practices, the CBN seeks to maintain a stable and efficient financial system and also prevent a repeat of the cash crunch experienced so far in the last two years towards year end.
