The Central Bank of Nigeria (CBN) has announced a hefty N150 million fine for each branch of any Deposit Money Bank (DMB) found guilty of supplying new naira notes to currency hawkers or shady agents. This announcement came in a circular issued on December 13, 2024, and signed by Mohammed Olayemi, the Acting Director of Currency Operations.
What They Are saying
The CBN is clearly fed up with seeing freshly minted naira notes in the hands of hawkers, turning what should be a public service into a cash-grabbing spectacle. According to the apex bank, this growing trend disrupts proper cash distribution to Nigerians and undermines the entire financial system.
The CBN made it clear that this isn’t a one-time punishment. After the first violation, which costs N150 million per offending branch, repeat offenses will attract even harsher penalties under the Banks and Other Financial Institutions Act (BOFIA) 2020. Simply put, the CBN is no longer playing games.
To back up its tough talk, the CBN plans to increase unannounced inspections in banking halls and ATMs. They’ve also introduced “mystery shoppers” to track down spots where hawkers sell naira notes like they’re trading tomatoes at a market.
The circular stressed that banks need to tighten their internal controls. Branches, cash management centers, and even teller operations must be revamped to ensure no one is slipping naira notes into the wrong hands
Why It Matters
This isn’t the first time the CBN has issued such warnings. Back in November, the bank reminded DMBs that cash hoarding, diversion, and misuse of naira notes would bring serious consequences. That warning also included the introduction of spot checks and undercover operations, which the CBN appears to be doubling down on now.
The apex bank also announced additional penalties for banks caught hoarding cash or diverting it away from legitimate use. Such banks will be fined 10% of the cash withdrawn from the CBN on the day the offense occurs, with an extra 5% fine for every repeat violation.
The CBN emphasized that these measures are part of its Clean Note Policy, which aims to ensure that cash flows smoothly through the system without being hijacked by hawkers or greedy intermediaries. As the festive season approaches, the bank is ramping up its efforts to prevent abuse of the naira and ensure that cash gets to those who need it most.
Bottom Line
With these penalties in place, the CBN is sending a strong warning to financial institutions: If you can’t distribute cash responsibly, expect to pay a big price.
