The Central Bank of Nigeria, CBN, has barred cash collection operators also known as Bank Neutral Cash Hubs (BNCH) from performing lending and investing activities.
The apex bank stated this in its guidelines for operation of BNCH.
It said:”The non permissible activities of BNCH according to the CBN are: 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; and any other activities that may be prohibited by the CBN.”
It, however noted, “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.”
According to the CBN, the key objective of setting up BNCH was 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.
The CBN said that, DMBs and Cash Processing Companies (CPCs) can apply for registration of a BNCH.
The apex bank noted that the financial requirements for the approval to operate as a BHCN is a non refundable fee of N600,000. It also placed a threshold of N500,000 for individual deposits and withdrawal limit and N1 million for corporate entities deposits and withdrawal limit.
It said : “The financial requirements for an approval to operate as BNCH which may be amended by the CBN as it deemed necessary are as follows: non refundable application fee of one hundred thousand Naira (N100,000) and non refundable approval fee of five hundred thousand Naira (N500,000).
“The threshold for eligible transactions at BNCH shall be as follow: A minimum transaction value of ¦ 500,000 (five hundred thousand naira only) for individuals and a minimum transaction value of ¦ 1,000,000 (one million naira only) for corporate
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