CBN Threatens To Penalise Banks Rejecting Mutilated Naira Notes

The Central Bank of Nigeria (CBN) has issued a stern warning to deposit money banks (DMBs) that refuse to accept mutilated naira notes. In a statement released on Thursday, Solaja Olayemi, the acting director of the currency operations department at CBN, highlighted numerous reports of such rejections by banks. The apex bank made it clear that it is prepared to impose severe penalties on any banks found guilty of refusing to accept these damaged notes from the public.

According to the CBN, the issue of banks rejecting naira deposits under any circumstances is unacceptable, and strict sanctions will be enforced against those who do so. This firm stance aims to ensure that the public’s deposits are accepted without bias or discrimination, maintaining trust in the banking system.

On July 2, the CBN addressed another issue concerning the rejection of old series and lower denominations of dollars by banks and authorized foreign exchange dealers. The central bank warned that such actions are not permitted and must cease immediately. The directive emphasized the CBN’s disapproval of the selective acceptance of deposits, urging all relevant parties to comply fully with the instructions provided.

The CBN revealed that during a consumer market survey, it found that old series and lower denominations of dollars were still being rejected. This discovery prompted the bank to reiterate its position on the matter, stressing that all parties must adhere to the guidelines to ensure a fair and efficient financial system. The CBN’s continued vigilance and enforcement are crucial in maintaining the integrity and functionality of the nation’s currency operations.

“The Central Bank of Nigeria (CBN) has received several reports of rejection of dirty/mutilated Naira banknotes by some Deposit Money Banks (DMBs),” the bank said.

“Consequently, it has become imperative to remind DMBs that the CBN circular dated July 2, 2019, reference number COD/DIR/GEN/CIR/01/006, which prescribes penalties for the rejection of Naira banknotes, is still enforceable and binding on erring DMBs.”