CBN Uncovers Cash Hoarding by VIPs, Vows Sanctions on Banks

By Badamasi Bello, Jadetimes Staff

B. Bello is a Jadetimes news reporter covering African News

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Image Source :CBN

The Central Bank of Nigeria has exposed wide-spread cash hoarding and preferential treatment by Deposit Money Banks (DMBs), leaving ordinary customers unable to access funds. In some recent spot checks conducted by the apex bank, banks were found to favor the so-called VIP customers when dispensing cash, thereby evoking the ire of the CBN.

These sources explained that the CBN is ready to give stiff penalties for the erring banks. Aside from a fine of N150 million that can be slammed against any erring branch found to have diverted newly minted notes to currency hawkers, the CBN warned institutions for participating in unfair cash distribution.

A top CBN official in Abuja corroborated these revelations, saying many DMBs stockpile cash for their VIP customers at the expense of ordinary customers who are frustrated at the OTC services and ATMs.

To stem the situation, the CBN has directed all banks to ensure equitable cash distribution through both OTC transactions and ATMs. It warned that it would increase surveillance and enforce compliance, with stiff penalties for any bank found to be collaborating with PoS operators in restricting cash flow to ordinary customers.

Public Urged to Report Cash Accessibility Issues

The CBN has called on Nigerians to report any challenges in accessing cash at bank branches or ATMs. Such complaints are to carry the following: name of account, name of bank, amount involved, date and time.

Such reports can be made through contact details on the CBN website or phone numbers provided for branches of the CBN across states. CBN urged that public feedback is fundamental in identifying and overcoming whatever bottlenecks may inhibit cash distribution.

Apex bank's attitude to equitable distribution of liquidity sustains its role as a regulator to safeguard the financial system and ensure public trust in the banking sector," an official at the CBN said.

FESTIVE SEASON SPARKS GROWING DEMAND FOR CASH

Cash demand rose even further with the Christmas and New Year celebrations, has also placed strain on the poor cash distribution system of Nigeria. Consumers at some Lagos bank branches, expressed anger over the scarcity.

Meanwhile, Pos operators seem unperturbed by the cash shortage and mete out cash to customers — mostly at a premium.

CBN's new intervention is to reestablish equity and confidence in the financial system so that every Nigerian will have access to cash without discrimination.