CBN Imposes N1.35bn Fine on 9 Banks for ATM Cash Shortages

The Central Bank of Nigeria (CBN) has imposed a total fine of N1.35 billion on nine banks for failing to ensure cash was available through automated teller machines (ATMs) during the busy yuletide season.

This penalty emphasizes the CBN’s commitment to preventing disruptions in cash flow and ensuring smooth circulation.

Each of the nine affected banks—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, and Sterling Bank Plc—has been fined N150 million for not complying with CBN’s cash distribution guidelines.

The fines came after the CBN conducted spot checks on the banks and issued repeated warnings to financial institutions about maintaining reliable cash availability, especially during peak demand periods.

The fines will be deducted directly from the banks’ accounts with the CBN, as confirmed by Mrs. Hakama Sidi Ali, the Acting Director of Corporate Communications at the CBN. She stated, “Ensuring seamless cash flow is paramount to maintaining public trust and economic stability. The CBN will not hesitate to impose further sanctions on any institution found violating its cash circulation guidelines.”

The CBN also warned that additional penalties would be imposed on any institution found to be in breach of its cash circulation policies. Additionally, the CBN’s monitoring will continue, focusing on preventing cash hoarding and rationing at bank branches and by Point-of-Sale (POS) operators.

The CBN is also working closely with security agencies to curb illegal cash sales and enforce the N1.2 million daily cumulative withdrawal limit for POS operators.

Governor Olayemi Cardoso, during his speech at the Annual Bankers’ Dinner of the Chartered Institute of Bankers of Nigeria (CIBN) in November 2024, had warned banks to strictly comply with the cash distribution policies or face serious penalties. He said, “Our focus remains on fostering trust, ensuring stability, and guaranteeing seamless cash circulation across the financial system.” Cardoso also reaffirmed the CBN’s dedication to maintaining a substantial cash buffer to meet the public’s needs, stating that non-compliance would lead to “severe penalties.”

In a related matter, the CBN has reiterated the validity of the old N1000, N500, and N200 banknotes. The CBN clarified that, in line with the Supreme Court ruling of November 29, 2023, these banknotes remain legal tender indefinitely, alongside the new designs of the same denominations. The CBN clarified in a statement: “For the avoidance of doubt, all versions of the naira, including the old and new designs of N1000, N500, and N200 denominations, as well as the commemorative and previous designs of the N100 denomination, remain valid and continue to be legal tender without any deadline.”

Mrs. Sidi Ali also urged the public, saying, “We therefore advise the public to disregard any claims that the old series of the aforementioned banknotes will cease to be legal tender on December 31, 2024. We urge Nigerians to continue accepting all Naira banknotes (both old and redesigned) for their daily transactions and to handle them with care to ensure their longevity.”