Nine banks were fined N1.35 billion by the Central Bank of Nigeria (CBN) yesterday for not allowing Naira notes to be used at automated teller machines (ATMs) during the Yuletide season.
The apex bank claims that the banks were fined in order to show that they have no tolerance for interruptions in cash flow.
Following spot checks on their branches, each bank was fined 150 million for non-compliance with the CBN’s cash distribution criteria.
The enforcement move comes after the CBN repeatedly cautioned banking institutions to ensure smooth cash availability, especially during times of high demand.
First Bank Plc, Fidelity Bank Plc, Keystone Bank Plc, Union Bank Plc, Globus Bank Plc, Providus Bank Plc, Zenith Bank Plc, United Bank for Africa Plc, and Sterling Bank Plc are among the impacted financial institutions.
The banks were informed that the penalty will be taken straight out of their apex bank accounts.
The development was confirmed by Mrs. Hakama Sidi Ali, the CBN’s Acting Director of Corporate Communications, who stated that “Ensuring seamless cash flow is paramount to maintaining public trust and economic stability.
“The CBN will not hesitate to impose further sanctions on any institution found violating its cash circulation guidelines,” she added.
Cash hoarding and rationing at bank branches and by Point-of-Sale (POS) operators will continue to be closely examined by the CBN’s investigations and oversight.
Cash hoarding and rationing at bank branches and by Point-of-Sale (POS) operators will continue to be closely examined by the CBN’s investigations and oversight. In order to combat illicit cash sales and operational infractions, the Central Bank is collaborating with security agencies to enforce the N1.2 million daily cumulative withdrawal cap for point-of-sale (POS) operators.
In November 2024, Governor Olayemi Cardoso advised banks to rigorously follow cash distribution policies or risk harsh fines during his speech at the Chartered Institute of Bankers of Nigeria (CIBN) Annual Bankers’ Dinner.
He reaffirmed the CBN’s resolve to keep a healthy cash reserve in order to support the needs of Nigerians. “Our focus remains on fostering trust, ensuring stability, and guaranteeing seamless cash circulation across the financial system,” Cardoso said.
The CBN warned that more infractions will result in immediate and severe penalties, and it asked all financial institutions to abide by its rules.
As for the previous N1000, N500, and N200 denominations, the CBN has reaffirmed their legitimacy and urged the public to ignore any assertions that they are no longer legal tender as of December 31, 2024.
The apex bank said in a statement signed by Mrs. Sidi Ali, Hakama, the Ag. Director, Corporate Communications, CBN, “The Central Bank of Nigeria (CBN) has observed the misinformation regarding the validity of the old ¦ 1000, ¦ 500, and ¦ 200 banknotes currently in circulation.
In line with the Bank’s previous clarifications and to offer further assurance, the CBN wishes to reiterate that the subsisting Supreme Court ruling granted on November 29, 2023, permits the concurrent circulation of all versions of the ¦ 1000, ¦ 500, and ¦ 200 denominations of the Naira indefinitely.
“For the avoidance of doubt, all versions of the naira, including the old and new designs of N1000, N500, and N200 denominations, as well as the commemorative and previous designs of the N100 denomination, remain valid and continue to be legal tender without any deadline.
“We, therefore, advise the public to disregard any claims that the old series of the aforementioned banknotes will cease to be legal tender on December 31, 2024.
We urge Nigerians to continue accepting all Naira banknotes (both old and redesigned) for their daily transactions and to handle them with care to ensure their longevity.”