The Central Bank of Nigeria (CBN) has introduced cash collection centres called Bank Neutral cash hubs to serve as central cash deposit points for bank customers across the country
According to the draft guideline released on Monday night, the CBN said the BNCHs will provide a platform for bank customers to make cash deposits and receive value irrespective of the bank with which their account is domiciled.
The CBN also stated that the BNCHs would reduce cost and improve operational efficiency in the country’s cash management value chain.
The draft guideline for the registration and operation of Bank Neutral Cash Hubs (BNCH) are in collaboration with the Bankers’ Committee.
According to the apex bank, the guideline aims to provide minimum standards and requirements for BNCH registration and operations for effective supervision. This move, it said, is in line with the Nigerian Cash Management System (NCMS) which seeks to reduce cost and improve operational efficiency in the country’s cash management value chain.
It explained that BNCHs which are; cash collection centers are to be established by registered processing companies or Deposit Money Banks (DMBs) based on business needs.
“They will be located in areas with high volumes of commercial activities and cash transactions.
The Bank Neutral Cash Hubs (BNCH) is to reduce the risks and cost borne by banks, merchants and huge cash handlers in the course of cash management activities; deepen financial inclusion; and and leverage on shared services to enhance cash management efficiency.
Under the guideline the BNCHs can carry out activities like: “receipt of naira denominated deposits on behalf of financial institutions from individuals and businesses with high volumes of cash. High volume cash disbursement to members of the public on behalf of financial institutions,” it stressed.
These banks are, however, barred from carrying out investing or lending activities. They are also not allowed to receive, disburse, or engage in any transaction involving foreign currency or sub-contract another entity to carry out its operations as well as undertake any other transaction not prescribed by the guideline.
The regulator noted that only deposit money banks and cash processing companies are allowed to apply for a BNCH registration and they are expected to provide a non-refundable application fee of N100,000 and a non-refundable approval fee of N500,000.
