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Wednesday, January 15, 2025

CBN Fines Banks N1.35bn for ATM Cash Shortages During Festive Season

In a bold move to uphold its commitment to cash flow efficiency, the Central Bank of Nigeria (CBN) has imposed fines totaling N1.35 billion on nine Deposit Money Banks (DMBs). The penalties are for their failure to ensure cash availability through automated teller machines (ATMs) during the recent festive season, a period traditionally marked by heightened demand for cash.

The sanctioned banks are:

1. Fidelity Bank Plc
2. First Bank Plc
3. Keystone Bank Plc
4. Union Bank Plc
5. Globus Bank Plc
6. Providus Bank Plc
7. Zenith Bank Plc
8. United Bank for Africa Plc
9. Sterling Bank Plc

Each bank will forfeit 150 million naira.
In a statement issued on Tuesday, CBN’s acting Director of Corporate Communications, Mrs. Hakama Sidi Ali, reaffirmed the apex bank’s commitment to ensuring seamless access to cash, especially during peak periods.
In a clear message of zero tolerance for cash flow disruptions, the Central Bank of Nigeria has sanctioned Deposit Money Banks for failing to make naira notes available through automated teller machines during the yuletide season,” the statement read.
The enforcement followed spot checks at various branches of the affected banks, which revealed widespread non-compliance with CBN’s cash distribution guidelines. Despite repeated warnings to prioritize ATM cash availability during high-demand periods, these financial institutions fell short, inconveniencing millions of Nigerians during the holidays.

The yuletide season often sees increased financial activity as families celebrate, travel, and shop. ATM cash shortages during this period led to frustration for many, with some customers resorting to Point of Sale (PoS) agents who charged exorbitant fees. The fines imposed by the CBN send a strong message to financial institutions about the importance of prioritizing customer needs.

Why This Matters

This development underscores the CBN’s dedication to holding banks accountable for delivering essential services. By debiting the fines directly from the banks’ accounts with the CBN, the apex bank ensures that the penalties are swiftly executed, reinforcing the seriousness of the directive.

For customers, this is a win. It highlights the CBN’s resolve to improve the banking experience and ensure that financial institutions serve the public effectively, particularly during critical periods.

While this enforcement action is a significant step, it also raises questions about the readiness of Nigerian banks to meet the demands of an increasingly cash-dependent economy during peak periods.

Will these fines lead to meaningful change, or will cash shortages remain a recurring issue?

What are your thoughts on this move by the CBN? Do you think it will compel banks to improve cash availability during critical periods? Share your views in the comments below!

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