CBN Begins Cash Hubs, urges banks to accept indemnity from customers

The Central Bank of Nigeria (CBN) says it is setting up cash hubs for safe handling of money in areas where heavy commercial activities take place.

This is contained in a circular it issued on Thursday.

The apex bank sets out the mode of the cash of the hubs in the circular titled, ‘Guidelines for the registration & operation of Bank Neutral Cash Hubs in Nigeria’.

According to the directive, registered (licensed) processing companies or Deposit Money Banks are responsible for the setting up of the cash hubs or cash collection centers.

The hubs will be in areas with high volumes of commercial activities and cash transactions while providing customers the opportunity to make cash deposits and receive value irrespective of the bank with which their account is domiciled.

The bank said the “guideline aims to provide minimum standards and requirements for BNCH registration and operations for effective supervision.”

Regarding its key objective, the CBN says the proposed BNCH would 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.

Equally, the CBN asked the banks and Payment Service Providers to accept indemnity from customers for highly secured online funds transfers.

The CBN said: “Further to the circular on the above reference BSP/DIR/GEN/CIR/01/011 and dated August 13, 2014, banks are hereby required to comply with the following:

“Accept indemnity from customers for highly secured online funds transfer above N1m for individual and N10m for corporate, subject to a maximum of N25m (individual) and N250m (corporate).

“Provide customers with the option of electronic or paper indemnity based on the customer’s preference.

“Implement electronic indemnity with stricter controls requiring biometric verification of identify.

“Adhere to multiple factor authentication for highly secured online funds transfer.

“Inform and educate customers on the use of indemnity to increase transaction limits where possible.”