The Central Bank of Nigeria has issued a warning to Deposit Money Banks regarding cash hoarding and diversion, emphasizing that severe penalties will be imposed for such actions. In a recent circular released by the CBN, measures have been intensified to ensure transparent and efficient cash disbursement. The apex bank has reminded banks of ongoing mystery shopping exercises and spot checks to prevent the misuse of naira notes and ensure responsible cash distribution, especially during the upcoming festive season. Any bank found involved in seized cash from unauthorized hawkers will face financial penalties, amounting to 10% of the total withdrawn cash from the CBN on the day of the offense, with repeat offenders facing additional penalties. The CBN also cautioned against cash hoarding, diversion, and activities that impede cash flow, emphasizing that such actions violate the Clean Note Policy and will result in appropriate sanctions. Banks are directed to implement internal controls for accountability in cash handling and prioritize cash dispensing through ATMs to enhance public access, particularly during the festive period. The CBN plans to collaborate with law enforcement agencies to monitor compliance through spot checks and mystery shopping to ensure that erring banks are held responsible and cash abuse is minimized. Reports indicate a shortage of cash in ATMs, while Point-of-Sales operators have been meeting customers’ cash needs as banks face challenges with low cash supply.
CBN warns banks against cash hoarding, diversion
