On Monday, the Central Bank of Nigeria (CBN) will hold a meeting with mobile money and point-of-sale representatives to discuss plans for the recently launched cash swap program, which aims to expedite the removal of old notes from circulation.
This information was released by the apex bank in a circular that was co-signed by Musa Jimoh, director of the payments system department, and Haruna Mustafa, director of the banking supervision department.
All DMBs, mobile money providers, super agents, and agents received the circular.
Recall that the CBN announced the cash swap program on Friday in collaboration with deposit money banks and super agents—companies that have been granted CBN licenses to hire agents for agency banking.
The cash swap program would go into effect on Monday, January 23, 2022, according to the CBN.
According to the statement, the initiative aims to make it possible for people who live in rural areas or have limited access to formal financial services to trade in their old naira notes for the newly designed ones.
By January 31, the outdated notes are anticipated to be eliminated from use.
According to the circular, “The existing lower denominations (N100, N50, and N20, etc.) are still legal tender and can be used in place of the old N1000, N500, and N200 notes.
The agent is only allowed to exchange up to N10,000 per person. In accordance with the cashless policy, amounts over N10,000 may be treated as cash-in deposits into wallets or bank accounts. The customer’s BVN, NIN, or voter card information should be recorded as completely as possible.
According to the CBN, anyone without a bank account could use the service in order to promote financial inclusion.
It stated that agents could use the CBN tiered know your customer framework to immediately open a wallet or account upon request.
The bank claims that by doing this, this group of people (unbanked citizens) will be able to exchange or deposit their cash without taking unneeded risks or paying excessive fees.
Additionally, the CBN instructed its agents to educate customers about opening bank accounts, wallets, and other types of electronic payment systems.
According to the updated cash withdrawal limit policy, designated agents are qualified to collect the redesigned notes from DMBs, according to the circular.
“Agents are also allowed to charge cash-out fees for cash swap transactions, but they are not allowed to charge customers any additional commissions for this service.
“Agents shall provide their designated banks with weekly reports regarding the cash swap transactions. The same will be provided on a weekly basis by the DMBs to the CBN.
Principals (super agents, MMOs, and DMBs) must be responsible for ensuring that their agents follow the aforementioned rules.
Cash swap agents, according to the apex bank, would be easy to spot in all local governments, especially those in rural areas.
In an interview with newsmen on Sunday, Mr. Victor Olojo, National President of the Association of Mobile Money and Bank Agents in Nigeria, stated that mobile money and bank agents would meet with the CBN on Monday to discuss the specifics of the cash swap program.
He argued that because there was so much money in circulation, the window of time given for the old notes to stop being accepted as legal tender was too small.
“The liquidity outside is very substantial. It will therefore require a lot of focused effort. On Monday, we will meet with the CBN officials once more. There is a lot we can do, but that time frame is challenging. But we’ll give it our best effort,” Olojo said.
Oloja also mentioned that the cash swap program might be subject to the standard withdrawal fee, which is equivalent to 2% of the cash withdrawn.
But he added that the charges would probably be discussed in the CBN meeting.
