CBN Introduces Bank Cash Hubs to Improve Cash Management Efficiency - Dealmakers Bureau De Change

CBN Introduces Bank Cash Hubs to Improve Cash Management Efficiency

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CBN Introduces Bank Cash Hubs to Improve Cash Management Efficiency

cbn bank cash hub

CBN Introduces Bank Cash Hubs to Improve Cash Management Efficiency

The Central Bank of Nigeria (CBN) on Monday 14th of March 2022, announced that it has introduced cash collection centres called ‘Bank Neutral Cash Hubs’ across the country to serve as central cash deposit points for bank customers.

According to the guidelines released by CBN, the BNCH 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 apex bank also said that the BNCH will play a key role in the reduction of cost and improvement of operational efficiency in the country’s cash management value chain. 

The introduction of the Bank Neutral Cash Hubs (BNCH) is as a result of a collaboration between the Central Bank of Nigeria and the Bankers’ Committee. BNCHs are cash collection centers and would be established by registered processing companies or Deposit Money Banks (DMBs) based on business needs, their guideline aims to provide minimum standards and requirements for BNCH registration and operations for effective supervision. This move, is in line with the Nigerian Cash Management System (NCMS). 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 and high-volume cash disbursement to members of the public on behalf of financial institutions”.

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. 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.

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 leverage on shared services to enhance cash management efficiency.

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