The Central Bank of Nigeria has indicated that some cheques, interest and dividend warrants currently being used are below standard.

It specifically said on Sunday that some of the security instruments produced for the Nigerian market such as cheques, interest and dividend warrants had not met the stipulated standard.

A circular posted by the CBN on its website said, “The Nigerian Cheque Standard and the Nigerian Cheque Printers Accreditation Scheme Document states that all security instruments produced for the Nigerian market must meet the stipulated standard.

“However, the MICR Technical Implementation Committee has noted with concern that most of the dividend and interest warrants produced for the Nigerian market do not meet the specified standard.”

The circular signed by the Director, Banking and Payment System Department, CBN, Mr. Dipo Fatokun, pointed out that accredited cheque printers would be sanctioned for security instruments produced by them that failed to meet the required standard.

Meanwhile, the CBN has withdrawn with immediate effect the circular to all Deposit Money Banks, micro finance banks and Primary Mortgage Banks, on the use of the National Identity Number for the “Know Your Customer Verification”.

The CBN, however, did not give reasons for the withdrawal.

The bank recently said that the KYC processes in banks and the recently concluded account verification exercise would cease to be the basis for KYC financial transactions from next year.

KYC in banks enables the financial institutions to know and understand their customers and their financial dealings.

A circular issued by the apex bank recently stated that a new National Identity Number, expected to be issued from September 2012 by the National Identity Management Commission, in conjunction with its Front End Partners, would be the new basis for KYC for financial transactions.

The circular had said, “As part of the CBN’s efforts to bolster the banking industry and the entire financial system, the bank in the recent past commenced steps to overhaul the KYC processes in banks, including the recently concluded customer account verification exercise. In furtherance of this exercise, the Bankers Committee at a recent meeting resolved to adopt the new National Identity Number, which is expected to be issued from September 2012.”

“Consequently, the CBN hereby directs that starting January 8, 2013, the NIN will become the basis for KYC verification and compliance by all Deposit Money Banks and, by extension, other deposit taking financial institutions including the micro finance banks and Primary Mortgage Banks in Nigeria.”

Source: Punch/Ademola Alawiye