The Central Bank of Nigeria has released guidelines for the registration and operation of the Bank Neutral Cash Hubs in in Nigeria
According to CBN, the guideline defines the registration requirements and operational procedures for the Bank Neutral Cash Hub which was conceptualized to offer bank-neutral cash withdrawal and deposit services to high volume/value cash transacting customers in a one-stop facility.
Provision of this service will serve to mitigate both risk and costs associated with currency management service provision.
The key objective of setting up 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 leverage on shared services to enhance cash management efficiency.
A BNCH may carry out the following:
- 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.
- Any other activities that may be permitted by the CBN.
Non Permissible Activities
A BNCH shall not:
- Carry out investing or lending activities.
- Receive, disburse, or engage in any transaction involving foreign currency.
- Undertake any other transaction which is not prescribed by this guideline.
- Sub-contract another entity to carry out its operations
- Any other activities that may be prohibited by the CBN.
The following may apply for registration of a BNCH:
- Deposit Money Banks (DMBs)
- Cash Processing Companies (CPCs)
Further details about the registration requirement of Bank Neutral Cash Hub can be found on the website of the Central Bank of Nigeria.