Central Bank of Nigeria Headquarters, Abuja, FCT

CBN directs banks, BDCs to accept old, lower US Dollar denominations

*The Central Bank of Nigeria says it will not hesitate to sanction any Deposit Money Banks, or other authorised Forex dealers that refuse to accept old series or smaller denominations of the US Dollar bills from consumers in the country

Isola Moses | ConsumerConnect

With a proviso to sanction any of the concerned stakeholders, who refuse to accept such denominations of the currency from consumers, the Central Bank of Nigeria (CBN) has directed the country’s Deposit Money Banks (DNBs) and Bureaus De Change (BDCs) operators to accept old and lower denominations of the US Dollars as a legal tender.

Mr. Ahmed Umar, Director of Currency Operations Department of CBN, issued this directive through a circular to the stakeholders in the foreign exchange (Forex) market in the country.

US Dollar bills

The Director of Currency Operations Department noted the CBN had been inundated with complaints about the rejection of old or lower denominations US Dollar deposits in the DMBs.

Umar stated that the Bankers’ Bank would sanction any of the concerned stakeholders, who refused to accept such denominations of the currency from their customers.

The apex bank warned: “The CBN had, in recent times, been inundated with complains from members of the public on the rejection of old/lower denominations of the US dollar bills by DMBs and other authorised Forex dealers.

“All DMBs and authorised forex dealers should, henceforth, accept both old series and lower denominations of USD that are legal tender for deposit by their customers.”

The circular further said: “The CBN will not hesitate to sanction any DMB or other authorised Forex dealers who refused to accept old series or lower denominations of the USD bills from their customers.”

Umar as well cautioned Forex dealers to desist from the habit of defacing or stamping Dollar banknotes, as such notes always failed authentication tests during sorting.

Meanwhile, the Central Bank of Nigeria has disclosed that the Nigerian manufacturing sector recorded further decline.

The Bank said the development resulted from the latest sector report showing the Manufacturing Purchasing Managers Index (PMI) for January 2021 at 44.9 index points, a 4.7 points drop from 49.6 index points recorded in December 2020.

Similarly, the non-manufacturing PMI fell by 2.4 points to 43.3 index points in January from 45.7 index points in December 2020, according to CBN.

A composite PMI above 50 points indicates that the manufacturing/non-manufacturing economy is generally expanding; 50 points indicate no change while a performance below 50 points indicates a contracting sector.

The apex bank’s Economic Report for January 2021, stated: “The Composite Manufacturing PMI contracted to 44.9 index points, from the 49.6 index points recorded in the preceding period.

“The decrease was associated with the decline in demand, rising production cost and supply chain bottlenecks experienced by firms, in the review period.

“All components of the Composite Manufacturing PMI contracted, except supplier delivery time, which increased to 55.7 index points from 51.2 points in December 2020, due to improvements in logistics, shipments and inventory control.”

On non-Manufacturing PMI, the CBN stated: “Similarly, the Composite Non-Manufacturing PMI for January 2021 dropped to 43.3 index points from 45.7 points in December 2020.

“The index recorded declines in all the subcomponent indexes.”

The report also noted that the level of employment and business activity declined during the review period.

According to the regulator, in January employment level fell by 2.1 points to 46.3 index points from 44.2 index points in December.

Similarly, level of business activity dropped by 3.1 points to 46.9 index points from 43.8 index points in December 2020.

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