CBN Warns Banks against Circulating Mutilated Naira Notes as Apex bank introduces clean note policy

he Central Bank of Nigeria (CBN) counseled commercial banks to stop  dispensing unfit naira notes either over the counter or through Automated Teller Machines (ATMs) after added a Clean Note Policy to put an quit to the regime of mutilated naira notes.

Classifying banknotes into nine levels, the coverage stipulated that banks need to make sure that they method their banknotes using registered processing organizations and classify them into fit and unfit.

Accordng to CBN, a banknote would be viewed unfit for recirculation if it was badly soiled or if there was once a conventional distribution/localisation of dirt.

It added that other points that ought to make a be aware be classified as unfit were if the word introduced a limp/rag appearance due to immoderate folding that resulted in the breakdown of the texture and shape of the word or if the note had delivered photograph or lettering marked on it or if had a gap that was once greater than 10 mm.

The Apex bank said, Unfit banknotes shall not be re-circulated with the aid of DMBs and CPCs. However, a penal charge of N12,000 per box, or any amount determined by using the management of the Bank, shall follow for the deposit of unsorted banknotes.

The banking sector regulator also stressed that mutilation of notes would attract a fine of N50,000 or six months’ imprisonment. In a circular issued by the CBN, it said the initiative was in a bid to enhance the availability of clean notes and effect expeditious withdrawal of dirty notes from circulation.

“The CBN and DMB shall continue to receive mutilated notes from the public. The procedures for the treatment of mutilated notes and the notes for exchange are as enshrined in the Central Bank Operational Manual for the Operation of Mutilated Notes.

The ATMs shall dispense notes that have been duly checked for authenticity and fitness according to the Bank’s standard and operators whose ATMs contravene this provision shall be sanctioned according to section 20 of the CBN Act. “Similarly, DMBs and service providers whose ATMs receive or dispense counterfeits or materials other than naira banknotes shall be liable according to section 20(4) of CBN Act 2007”.

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