CBN Revises Banks’ Clearing System Rules

• CBN Revises Banks’ Clearing System Rules

The Central Bank of Nigeria said on Wednesday that it had revised the clearing system rules for Deposit Money Banks.

The Director, Banking and Payments System Department, CBN, Dipo Fatokun, in a circular issued to banks, mobile money operators and payment service providers, said the revision of the Nigeria Bankers’ Clearing System Rules was in furtherance of its mandate for the development of electronic payments system in the country.

He said the revision would take effect from September 1, 2018

According to the revised rules, electronic payment instruments will be presented to the clearing system in the next applicable session if instruction is received from customers less than two hours before closure of session available for the financial instrument, unless the relevant service agreement dictates otherwise.

The apex bank said, “A member bank will be suspended from participating in any clearing session if an amount of clearing collateral that has been utilised to fund an account is not replaced within two business days, or if a collateral so discounted is insufficient, or if a bank overdraws its settlement account maintained with the CBN for three consecutive working days.

“A member bank can also be suspended if it persistently overdraws its account with its settlement bank and the settlement bank communicates its intention to stop settling for such a non-settlement bank to the CBN and Nigeria Inter-Bank Settlement System Plc, or if a bank fails to provide the requisite infrastructure to enable electronic exchange of eligible payment instrument, or fails to maintain adequate collateral with either the CBN (in the case of a settlement bank) or its settlement bank (in the case of a non-settlement bank) in accordance to section six of these rules.”

According to the revised rules, the return period of cheques, which used to be the same day, has been extended to 5pm of the next day.

“All clearing instruments returned unpaid shall now bear the appropriate returned reason code,” the CBN addeed.

A comparison of the sanctions grid in the May 2018 revised edition of the NBCS rules with that of December 2016 revealed that the fine for transmission of data not in agreement with images and representment of already paid cheque would each be N1,000 per item instead of N250 per item.

It also showed that the transmission of more than 100 cheques in the special clearing session by a bank would attract a fine of N50,000 instead of N100,000.

“In addition, the failure of a member to indicate the correct reason for returning a payment instrument would attract a fine of N250 per instrument,” the CBN added.