Private sector to handle CBN’s retail currency management function

The Central Bank of Nigeria (CBN) has said that efforts are being made to devolve its retail currency management function  to the private sector while the bank concentrates on the wholesale function.

This is even as CBN in furtherance of its mandate, to ensure the management of legal tender currency in Nigeria and ensure the recirculation of clean, fit and high quality banknotes, has approved the issuance of the Clean Note Policy and Banknote Fitness Guidelines to the general public.

The bank announced this over the weekend in a clean note policy guideline released on Friday.

The Clean Note Policy provides a uniform standard for the circulation of only clean and fit banknotes in Nigeria; while the Banknote Fitness Guidelines provide the industry with clear and acceptable criteria for determining the quality of banknote in circulation.

According to the bank,  these objectives cannot be achieved without the collaboration of deposit money banks (DMBs), merchant banks, microfinance banks, government agencies, Cash-in-Transit (CIT), cash processing companies (CPCs), market associations, merchants/retailers, chambers of commerce and industry, security agencies, currency management equipment manufacturers, bank customers and the general public.

Consequently, the unveiling of the Clean Note Policy and Banknote Fitness Guidelines documents would be held in Lagos on Tuesday.

The Governor, Central Bank of Nigeria, Mr Godwin Emefiele  in consort with key industry stakeholders would perform the unveiling.

According to the CBN, to achieve the Clean Note Policy in the context that the private sector plays a key role in sorting banknotes and adhere to all the guidelines and use of approved processing infrastructure, the bank realises the need to issue the Clean Note Policy encapsulated in a document.

“The objective for the issuance of this handbook is therefore, to ensure compliance with cash management standards and practices,” the document available on CBN’s website stated.

The bank in another guideline titled, “Updated Banknote Fitness Guidelines,” described a fit banknote as a banknote that is suitable for continued circulation and is sufficiently clean to allow its authenticity and value to be readily ascertained.

It also described unfit banknote, as a banknote that is unsuitable for further circulation because of its physical condition, which may be soiled, dirty, limp, worn out, defaced or has a hole that is larger than 10 mm.

“Unfit notes should be returned to a deposit money bank (DMBs) or a branch of the CBN anywhere in Nigeria for exchange,” the bank noted.

These guidelines according to CBN,  provide the general public with clear, acceptable criteria and standards for determining the quality of banknotes in circulation.

Fitness standards are developed for all denominations of the banknote. These standards establish the desired fitness criteria and parameters for the banknotes which provide a benchmark and reference for evaluating banknotes in circulation.

The apex banking sector regulator listed fitness criteria to include:The durability and functionality of security features on the notes; Banknotes structure and durability; and Banknote quality  which involves printing and appearance of the banknotes (soiling/ink wear) among others.