The Central Bank of Nigeria (CBN) has issued a stern warning to Deposit Money Banks (DMBs) against hoarding and diverting cash, emphasizing that such actions will attract significant penalties.
In a circular dated November 13, 2024, and signed by the Acting Director of Currency Operations, Muhammad J. Olayemi, the CBN outlined new measures to ensure efficient and transparent cash disbursement, especially as the festive season approaches.
### **Key Measures and Penalties**
The CBN highlighted its ongoing mystery shopping exercises and spot checks aimed at discouraging cash abuse and promoting responsible distribution of naira notes. The measures include:
– **Penalties for Misconduct:**
– DMBs linked to cash seized from unauthorized hawkers will be fined 10% of the total value of cash withdrawn from the CBN on the day of the offence.
– Repeat offences will attract an additional 5% penalty for each subsequent breach.
– **Sanctions for Cash Hoarding and Diversion:**
– Banks found guilty of hoarding or diverting cash in violation of the Clean Note Policy will face fines and other regulatory actions.
### **Enhanced Monitoring and Compliance**
The CBN has directed banks to prioritize cash distribution through Automated Teller Machines (ATMs) to improve public access and mitigate complaints of cash scarcity. It further urged DMBs to strengthen internal controls to ensure accountability and transparency in cash handling.
The apex bank plans to collaborate with law enforcement agencies to intensify monitoring through spot checks and undercover operations to enforce compliance and hold erring banks accountable.
### **Cash Shortages Persist**
Despite these measures, reports indicate that ATMs across the country, particularly in the Federal Capital Territory, remain understocked, forcing banks to ration cash withdrawals. Over-the-counter withdrawals are now capped between ₦5,000 and ₦20,000 daily in some branches.
Meanwhile, Point-of-Sales (PoS) operators continue to play a critical role in meeting customer cash demands amid the ongoing shortages.
As the festive period draws near, the CBN’s directive aims to alleviate cash flow issues and prevent further disruptions in the distribution of naira notes.
