Banks Get New Directives From CBN

By Ikenga Chronicles August 16, 2019

Banks Get New Directives From CBN

The Central Bank of Nigeria (CBN) has released new directives to banks for the disbursement of lower denominations of the Naira through Microfinance Banks (MFBs) across the country.

This was made known by the bank’s Director, Corporate Communications Department, Mr. Isaac Okorafor in Abuja on Thursday.

According to him, all Microfinance Banks must have a Composite Risk Rating (CRR) of above average in the most recent Risk Based Supervision (RBS) target examination before they are considered for the scheme.

He explained that the measure was to ensure that only MFBs with good corporate governance practices took part, NAN reports.

“Meanwhile, the participating MFBs must be willing to accept a mixture of new and other banknotes, and that the MFBs shall give 20 per cent of any withdrawal in lower denomination notes subject to a maximum of N50,000.

“Where beneficiaries withdraw more than once in a day, the circular said that disbursement will only apply to one transaction per day.

“Similarly, the MFBs are allowed to exchange notes subject to a maximum of N50,000 for customers with bank accounts and N10,000 for customers without bank accounts.

“In that situation, the banks must not exchange for same beneficiaries more than once a week,” he added.

According to him, MFBs are to maintain a register of amounts received from the CBN through their correspondent commercial banks.

Okorafor said the MFB must also maintain another register of the beneficiaries of the lower denomination notes as well as ensure that withdrawal teller slips contain breakdown of the denomination of the currency to customers with accounts.

“The circular also warned MFBs against hawking, hoarding or using of funds obtained under the intervention for anyother purpose.

“It also instructed the banks to put in place effective control measures that will ensure that banknotes disbursed tocustomers with or without accounts are not sold.

“Furthermore, the circular directed the banks to render weekly and monthly disbursement return to CBN branches where the intervention would be monitored periodically, and appropriate sanctions applied to erring MFBs,” he said.

172 views