The Central Bank of Nigeria (CBN) has announced stringent penalties of ₦150 million per branch on Deposit Money Banks (DMBs) found guilty of aiding the illegal circulation of mint naira notes to currency hawkers and unauthorized agents.
This directive was outlined in a circular issued on Friday, December 13, 2024, signed by the Acting Director of the Currency Operations Department, Mohammed Olayemi.
The apex bank expressed concern over the increasing commodification of mint naira notes, a practice it described as a significant obstacle to efficient cash distribution for customers and the public.
Under the new guidelines, any branch of a financial institution implicated in the illicit flow of fresh naira notes will face a fine of ₦150 million for a first violation, with stricter sanctions awaiting repeat offenders under the provisions of the Banks and Other Financial Institutions Act (BOFIA) 2020.
To ensure compliance, the CBN plans to intensify spot checks in banking halls and ATMs while deploying mystery shoppers to uncover hawking hotspots nationwide.
The circular reaffirmed the CBN’s commitment to addressing this issue, stating:
“CBN has noted with dismay the prevalence of illicit flow of mint banknotes to currency hawkers and other unscrupulous economic agents that commodify Naira banknotes, thus impeding efficient and effective cash distribution to banks’ customers and the general public.
“In this regard, any erring deposit money banks or financial institutions that are culpable of facilitating, aiding, or abetting, by direct actions or inactions, the illicit flow of mint banknotes to currency hawkers shall be penalized at first instance ₦150,000,000.00 per erring branch, and at later instances, apply the full weight of relevant provisions of BOFIA 2020.”
The CBN also stated that DMBs found seizing cash for unauthorized hawkers would face a 10% fine on the total value of cash withdrawn from the CBN on the day the offense occurred. Repeat offenders will face an additional 5% penalty for subsequent breaches.
These measures form part of broader efforts to enforce the Clean Note Policy and ensure efficient cash flow across the economy.
The apex bank has urged financial institutions to strengthen controls within their Cash Management Centres, branches, and teller operations to prevent exploitation of their systems for illegal transactions.
With the festive season approaching, the CBN reiterated its commitment to discouraging naira abuse and ensuring responsible cash disbursement through ongoing spot checks and mystery shopping exercises.
The central bank warned that cash hoarding, diversion, and other practices that undermine cash flow would attract severe penalties, including additional fines and other regulatory actions.
These actions underscore the CBN’s determination to restore integrity to the currency distribution process while deterring economic agents from commodifying the naira.
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