12 days to deadline, confusion trails release of new notes as CBN threatens erring banks

With the introduction of the cash withdrawal policy and the new denominations of N200, 500 and N1000 naira notes, the CBN mandated financial institutions early this month to load their automated teller machines, (ATM) with the new naira notes and begin dispensing them to customers.

This was aimed at making sure the notes are in circulation while the old notes are returned before the deadline date. As of yesterday, January 18, 2023, most ATMs were still dispensing the old notes despite the apex bank’s threat to sanction erring banks.

A bank staff who spoke earlier with Sahara Reporters revealed the reason why some banks are yet to comply was that some of the new notes did not pass the ‘dispensing test’ when it was loaded into the ATM.

The source said “Loading of ATMs is the responsibility of the banks. When our bank tested the ATMs, only one denomination of the new notes passed the test of dispensing seamlessly through our machines. The bank is working on reconfiguring the ATMs to be able to dispense the new notes. What we have done in my branch is to mix the few new N1,000 and N500 notes available with old ones so that desperate customers can make withdrawals and meet their immediate needs.”

The CBN, while giving reasons for demanding that the notes be loaded via the ATM instead of over-the-counter noted that there were reports of sharp practices while issuing the notes.

It was reported that some of the banks hoarded the notes and issued them based on preferences. They issued the notes to high-profile customers in large quantity while the ordinary customers went home with the old notes.

With the reports of sharp practices and non-compliance flying around, the Director of the Legal Services Department of the Central Bank of Nigeria, Mr. Kofo Salam-Alada, has reiterated the apex bank’s stand on going tough on banks that continue to fill their ATM with old naira notes as the deadline to phase out the notes nears.

Salam-Alada disclosed this during a sensitization workshop in the popular computer village in Lagos where the bank went to give more orientation to citizens on the new notes and how the CBN is making efforts to make sure it comes into circulation.

He also stated that the CBN was currently monitoring banks that were still dispensing old naira notes from their ATMs.

He said, “I can tell you today that the CBN on daily basis issue out the new notes. As we speak, banks are with the CBN taking money. We are actually begging banks to come and take money from Central Bank. We have these new naira notes in our vaults and we are begging banks to come and take it.”

The bank also mentioned that it would seriously clamp down on anyone hoarding and selling the new notes as such individuals risked being jailed.