Microfinance Banks to Receive Lower Currency Denominations from CBN

• Microfinance Banks to Receive Lower Currency Denominations from CBN

The Central Bank of Nigeria (CBN) has said Microfinance banks across the country would receive lower denominations of the Naira.

The apex bank said in a circular issued by Mrs. Patricia Eleje, the Director, Currency Operations Department, CBN.

The circular noted that only microfinance banks with a composite risk rating (CRR) above average in the recent Risk Based Supervision (RBS) will be considered for the scheme.

According to the CBN, this measure will ensure that only MFBs with standard corporate practices take part in the scheme.

Also, the approved MFBs must accept a mixture of new and other banknotes. Meaning, MFBs shall give 20 per cent of withdrawal not more than 50,000 in lower denomination notes.

“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.

“Also, MFBs are to maintain a register of amounts received from the CBN through their correspondent commercial banks. 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 stated.

The apex bank, however, warned against hoarding or use of funds received under the intervention for any other purpose.

MFBs are also directed to put in place control measures to ensure banknotes disbursed to customers with or without accounts are not sold.