The Central Bank of Nigeria (CBN) has imposed fines totaling N1.35 billion on nine Deposit Money Banks for failing to ensure cash availability at Automated Teller Machines (ATMs) during the festive season. Each bank was fined N150 million for non-compliance with the apex bank’s cash distribution guidelines.
Banks Penalized for Non-Compliance
The affected banks include:
- 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
- Sterling Bank Plc
The fines will be directly debited from the accounts of the sanctioned banks with the CBN.
CBN’s Zero-Tolerance Stance
In a press statement issued on Tuesday, the acting Director of Corporate Communications at the CBN, Mrs. Hakama Sidi, emphasized the bank’s commitment to ensuring seamless cash availability. The statement read, “In a clear message of zero tolerance for cash flow disruptions, the Central Bank of Nigeria has sanctioned Deposit Money Banks for failing to make Naira notes available through automated teller machines during the yuletide season.”
The sanctions follow spot checks on bank branches, revealing non-compliance with cash distribution policies, despite repeated warnings from the apex bank.
Enhanced Monitoring and Enforcement
The enforcement action underscores the CBN’s determination to prioritize customer needs and maintain uninterrupted access to cash. Mrs. Sidi stated that the bank would not hesitate to impose further sanctions on financial institutions violating cash circulation guidelines.
To curb cash hoarding and rationing, the CBN announced intensified monitoring at bank branches and Point-of-Sale (POS) terminals. Collaborating with security agencies, the regulator aims to address illegal cash sales and ensure compliance with the daily withdrawal limit of N1.2 million for POS operators.
Recent Measures to Ensure Cash Flow
The fines are part of broader measures by the CBN to enhance cash circulation. In September 2024, the apex bank announced plans to penalize banks failing to dispense cash via ATMs. This was followed by a November directive urging customers to report issues with cash withdrawals at ATMs and bank branches starting December 1, 2024. Designated state-specific phone numbers and email addresses were provided to facilitate customer complaints.
Implications for Banks and Customers
The enforcement action sends a strong signal to financial institutions about the importance of adhering to cash distribution policies, particularly during periods of high demand. For customers, it reinforces the CBN’s commitment to safeguarding their access to essential banking services.
The sanctions reflect the regulator’s resolve to address cash shortages, ensure transparency in cash distribution, and maintain trust in Nigeria’s banking system. As the CBN intensifies its monitoring efforts, banks are expected to improve compliance, ensuring seamless cash availability for their customers.
The penalties serve as a reminder of the shared responsibility between financial institutions and regulators to deliver reliable banking services, especially during critical times such as the festive season.
