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Nairaland Forum / Nairaland / General / Politics / Cbn:: No More N10m Cheques, From Jan 1, 2010 (5510 Views)
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Cbn:: No More N10m Cheques, From Jan 1, 2010 by chosen04(f): 4:20pm On Dec 14, 2009 |
With effect from January 1, next year, no bank in Nigeria will allow more than ten million naira to be drawn on a cheque, the Central Bank of Nigeria [CBN] directed at the weekend. It said the aim was to strengthen the e-payment system in the country. This directive will be circulated to all banks today, CBN’s deputy director, Banking Operations Department Mr. C.R. Okafor said at the annual dinner/awards night of the Abuja Clearing House/Bankers’ Committee in Abuja at the weekend. CBN had in a circular with reference BOD/DIR/GEN/01/106 said, “As a further step in its efforts at enhancing the efficiency of the payment system in the country, the CBN hereby sets a maximum limit on cheque payment at N10 million with effect from 1st January, 2010. “To this end, any payment value exceeding N10 million should be made through the e-payment mode such as the Central Bank Inter-Bank Funds Transfer System (CIFTS i.e. RTGS) and Nigeria Inter-Bank Settlement System Electronic Fund Transfer (NEFT) from that date. “The maximum limit serves as a risk reduction measure in the clearing and settlement arrangement in line with international best practice. To support this initiative, deposit money banks are implored to properly educate their customers on the implementation procedure.” Okafor said CBN will through this directive ask the banks to consolidate their accounts. He said a circular will be sent to the banks directing them to maintain a maximum of three accounts at the clearing house. He said that all other accounts outside these three will be closed by the CBN. CBN’s Abuja Branch Controller John Chukwudifu said at the dinner that the 24 banks operating in the Abuja clearing zone had a total of 1, 247, 596 financial instruments valued at N117.04 billion. He said they also have 481,223 funds transfers (NEFT) valued at N2.622 trillion at the clearing house as at November 30. Chukwudifu said there was a reduction of about 410,446 in volume which translates into N4.336 trillion in value of cheques cleared in Abuja clearing zone. He said this is a “reflection of the impact of the e-payment policy of the Federal Government which requires payments by all MDAs to be done electronically, without recourse to the use of cheque.” He said the CBN, through the Agricultural Credit Guarantee Scheme (ACGS), guaranteed 127 loans valued at N77 million which were disbursed to farmers in the Federal Capital Territory by three banks. First Bank of Nigeria disbursed 60 loans valued at N40.9 million; Union Bank gave 66 loans valued at N35.8 million while Unity Bank gave one loan valued at N1 million. Also at the weekend, the Federal Ministry of Finance commended CBN for the progress made in addressing the challenges facing the banking sector. Minister of Finance Dr Mansur Muhtar said the efforts are on the right track. He said, “The Ministry is particularly supportive of the improvements being made to the accounting and financial reporting system of the sector, which will enhance transparency and accountability, strengthen corporate governance practices as well as provide a better platform for more effective risk management.” He said the Ministry has reviewed the recent financial reports presented by the commercial banks and the associated measures to adjust their balance sheets, in line with the new rules and procedures. He said, “While these may present short term challenges to the banks, they do provide an opportunity to draw the line and begin afresh. We remain optimistic that the steps being taken will put the financial sector on a sounder footing, which is pivotal to strengthening our economy. http://www.news.dailytrust.com/index.php?option=com_content&view=article&id=11039:cbn-no-more-n10m- cheques-from-jan-1-&catid=46:lead-stories&Itemid=140
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Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by Nobody: 4:44pm On Dec 14, 2009 |
Me likes. Me likes. +1 to Sanusi |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by Gekko(m): 5:02pm On Dec 14, 2009 |
Good initiative, this should curb fraudulent activities. Hopefully, they won't charge exorbitant wire transfer fees. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by mastro: 5:14pm On Dec 14, 2009 |
Typical nonsense IMO, big words that don't mean anything. Seeing that banks will check with issuers for chq's of large amounts if you ask them to, I really don't see the point. Like most businesses I tend to pay my suppliers by chq's and get paid by chq as well, why must I raise a draft at (extra expense) for every transaction over N10m? Could anyone tell me the advantage? |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by Afam(m): 6:45pm On Dec 14, 2009 |
Basic e-payment implementations are having clearly avoidable issues and we are expecting the industry to do more? |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by chosen04(f): 6:51pm On Dec 14, 2009 |
mastro: Its secured, safe, reliable and will help prevent fraudulent activities.E.g Cashing and recieving payments for jobs not executed. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by otokx(m): 7:18pm On Dec 14, 2009 |
is this idea for both public and private sector? Already we are having a lot of ISSUES with remitting money in the educational sector. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by mamagee3(f): 7:43pm On Dec 14, 2009 |
I want the cash. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by biina: 8:02pm On Dec 14, 2009 |
mastro:Feel free to pay them with multiple smaller cheques Its not just about fraud but also to reduce the level of cash transactions (and hopefully increase electronic ones), which would in turn give the CBN a firmer grip on monetary issues and make policies more effective. Unfortunately, like the typical Nigerian, you cant seem to see beyond yourself. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by mastro: 11:31pm On Dec 14, 2009 |
Feel free to pay them with multiple smaller cheques I would say you didn't have a clue what you're talking about, (hint, a chq transaction isn't a cash transaction) But on a more serious note, please explain to me how this makes policies more effective. Bearing in mind that nowadays virtually all large scale fraud is done via the eletronic bank transfer systems that the central bank are touting. Or do you think that people walk into a branch with a chq for N1billion and cash it. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by Fhemmmy: 11:43pm On Dec 14, 2009 |
I hear . . . .eyes are watching. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by biina: 1:14am On Dec 15, 2009 |
mastro:The question then would be what is the difference between a personal cheque, a bank draft, and banknotes? Like I said before its not just about fraud (even though electronic systems are overall more secure than paper based schemes). Policies are more effective cos there is less money in 'limbo'. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by elaojukan: 9:56am On Dec 15, 2009 |
Good intentions but i will suggest that banks should guarantee a well secured online transactions before implementing this policy. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by Afam(m): 10:15am On Dec 15, 2009 |
elaojukan: Guarantee? They cannot because many of them lack the relevant knowledge. You would be surprised to realize that some IT managers of some of these banks know very little about IT and I am not exaggerating, it is that bad. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by biina: 10:19am On Dec 15, 2009 |
Afam:more saddening is that often there are others who could do the job but do not get the opportunity because they don't know the 'right' people |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by ProAnti: 10:24am On Dec 15, 2009 |
The e-revolution can only get to Nigerians when they see superior and more secure e-services. You dont force people to use a system you are testing; you only encourage them. If the NEFT transfer system is more secure, no sane Nigerian businessman would want to issue a cheque. As it is, the widely known ATM fraud discourages people from getting involved with any electronic system. The CBN should first address banking security before coming up with the NEFT policy. By the way, I did a NEFT transfer to a business associate last month and he said he hasnt seen the money. I've been chasing this for some time now with no success. Dont expect me to try it again unless the system improves. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by No2Atheism(m): 10:26am On Dec 15, 2009 |
Afam: Very possible. . . and not really catastrophic cus the main job of the manager is to "manage" those that actually do the IT job, hence its not really a catastrophic situation if the IT manager does not really know much about IT. All that matters is that he or she is IT oriented enough to make the IT geeks to innovate. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by No2Atheism(m): 10:28am On Dec 15, 2009 |
Pro Anti: Very true . . .cus despite my IT savvyness (yes i invented another word so sue me) I am still wary of any electronic transactions within Nigeria simply because I know (via first hand experience) that IT infrastructure within Nigeria is not yet robust enough to tackle fraud. Also Nigerians are still too wayo minded . . . sef. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by Spyker: 10:32am On Dec 15, 2009 |
It sounds like a bright idea but to think of the huge amount of money looted via electronic transfers and atm's in the country, i really don't think it will solve any problem, rather it may increase the number of fraud in the system. Our e-banking system is not very secured. Even the CBN has been hit by e-fraud. For example, some fraudsters developed a website some years ago and named it www.centralbankofnigeria.org and defrauded so many persons and organizations before the CBN shut the site down. They have to register their own site www.cenbank.org. I fear that fraudsters will cash in on this e-banking policy and defraud many persons. But if we take the CBN very serious, then the first six months of this policy will either show their seriousness or not. Time will tell. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by biina: 10:39am On Dec 15, 2009 |
No2Atheism:that is debatable. There are different levels of management, and different levels of abstraction are affordable. An operations level manager needs a considerable level of hands on knowledge, while an executive could do with little to none. Effective IT management often requires that the manager be knowledgeable in IT, else you could end up employing someone who could do the manager's job as his subordinate (which is a quite inefficient arrangement). |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by No2Atheism(m): 10:57am On Dec 15, 2009 |
biina: Okay |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by Nobody: 10:59am On Dec 15, 2009 |
excellent move! |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by anishe(m): 11:01am On Dec 15, 2009 |
ABSOLUTE NONSENSE. How will this translate to three square meals for the average Nigerian. RUBBISH |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by Nobody: 11:04am On Dec 15, 2009 |
Are you sure the thieving politicians will be happy about this? |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by MUNEER2(m): 11:18am On Dec 15, 2009 |
Has this been effected? cos i don't think this is any money for big companies, it gat to be for private individuals only |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by Nobody: 11:53am On Dec 15, 2009 |
anishe: yes it does not translate to a three square meal for the average nigerian but it signifies transparency. The average Nigerian would have a limited excuse in complaining about the degree of embezzled FG funds for one. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by ProAnti: 12:20pm On Dec 15, 2009 |
arkinses: All the loots in Swiss accounts were not deposited via cheques, they were wired. The CBN move wont have any effect on corruption; It will only make some Yahoo youngsters richer and nastier. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by pacodas: 2:08pm On Dec 15, 2009 |
This effects genuine businessmen and not fraudsters. I don't think its a good move |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by ribbon: 2:12pm On Dec 15, 2009 |
it won't cure our madness. they are looking for convinient way to loot more money. bank check carriage is becoming bulky anyway. sophisticated technology everywhere. nice plan. soon we will see the implication. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by netotse(m): 2:27pm On Dec 15, 2009 |
this sounds good, it'll create a paper trail that'll be easier to follow! |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by edoyad(m): 2:53pm On Dec 15, 2009 |
How can one say it is easier to loot funds with e payment ? Do you know that with epayment EFCC can track every single kobo that moves around Nigeria ? Why do you think. Governors now travel with their looted cash(hard currency) to deposit in their foreign accounts ? We have just read of a bank executive who was nabbed at an airport with $3.5 m , do you think she would take that risk if they could have just wired the money out ? Look at the Erastus case, how come the transfer to his accounts were easily traced ? Stop talking like illiterates and embrace development. |
Re: Cbn:: No More N10m Cheques, From Jan 1, 2010 by AjanleKoko: 5:07pm On Dec 15, 2009 |
A good development. Means banks will start investing in IT security infrastructure. Anyways, blue chips have been sweeping up e-payments with solutions like Interswitch's Paydirect anyways. At least we in the telco use them for collections. But, all said, the banks + NEFT need to beef up the security infrastructure around these solutions. Not like we have seriously skilled hackers in Nigeria, most of the fraud is a combination of crude internal work, web site spoofing, and phishing attempts. Nothing that can't be blocked. |
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