The Central Bank of Nigeria (CBN) has imposed a total fine of N1.35 billion on nine commercial banks for failing to ensure the availability of Naira notes through Automated Teller Machines (ATMs) during the festive season. This action follows the CBN’s zero-tolerance stance on cash flow disruptions, especially during high-demand periods like the yuletide.
Each of the nine banks—Fidelity Bank Plc, First 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—was fined N150 million for non-compliance with the CBN’s cash distribution guidelines. Spot checks conducted by the apex bank revealed the failure of these banks to maintain sufficient cash supplies in their ATMs, a requirement that ensures smooth banking operations during peak periods.
The fines will be debited directly from the accounts of the affected banks with the CBN. This enforcement action follows multiple warnings from the apex bank, which emphasized the importance of ensuring cash availability, particularly during festive seasons when demand for cash is typically high.
CBN’s Commitment to Cash Flow Management
Mrs. Hakama Sidi Ali, the Acting Director of Corporate Communications at the CBN, confirmed the fine and reiterated the central bank’s commitment to ensuring seamless cash circulation, crucial for maintaining public trust and economic stability. The CBN has made it clear that any future violations would lead to stricter sanctions.
The CBN’s monitoring activities will continue to scrutinize banks and Point-of-Sale (POS) operators for any signs of cash hoarding, rationing, or violations of operational limits. The CBN is collaborating with security agencies to combat illegal cash sales and ensure that POS operators adhere to the daily withdrawal limit of N1.2 million.
Further Measures to Ensure Cash Availability
Governor Olayemi Cardoso, in his address at the Annual Bankers’ Dinner in November 2024, warned financial institutions to strictly comply with cash distribution policies or face severe penalties. He emphasized the CBN’s determination to ensure a robust cash buffer for Nigerians’ needs and reiterated the commitment to a stable financial system.
Clarification on Validity of Old Naira Notes
In another important update, the CBN has reassured the public regarding the validity of the old N1000, N500, and N200 Naira denominations. Contrary to misinformation circulating about the discontinuation of the old banknotes on December 31, 2024, the CBN has clarified that all versions of the N1000, N500, and N200 denominations, both old and new designs, are valid and continue to be legal tender.
This clarification follows a Supreme Court ruling on November 29, 2023, which permitted the concurrent circulation of both the old and new Naira notes indefinitely. The CBN has urged Nigerians to continue accepting both old and new banknotes for transactions and to handle them with care to ensure their longevity.
The Central Bank’s firm stance on cash flow management and its efforts to maintain economic stability reflect its ongoing commitment to supporting the Nigerian financial system and ensuring a smooth banking experience for all Nigerians.
