Some banks operating in the country now turn back customers with mutilated currencies.
This is as a result of the misinterpretation of a circular sent to commercial banks on October 12 this year by the Central Bank.
The Central Bank had on that date in a circular signed by the assistant director of currency operation said that the CBN had observed that banks are in the habit of forwarding to CBN currency notes purported to be mutilated for exchange whereas such notes do not qualify to be treated as such.
The circular stated that for t he avoidance of doubt it should be noted that mutilated currency notes that qualify for payment are those that are badly torn, defaced, burnt soiled or eaten by pest.
The circular also said that those not within the above classification such as dirty notes should henceforth be made up into puckets/bundles to be deposited in CBN treasury office to the credit of the concerned banks.
On receipt of this circular, banks head office sent directives to their branches. An investigation conducted by The Republic revealed that the interpretation given to the circulation varied from as many bank as there are banks in the country.
Allied Bank interpreted the circular as meaning that they should not take mutilated currency from non-customers, they accept such torn notes only when they are paid into an account. Non-customer they said cannot be given such a privilage.
According to a senior manager with the banks at Elephant House, Lagos, when they collect such money and take them to CBN they are only paid in bits.
The manager said, there was no reason why banks should be up huge sums of money in defaced currency that the CBN would not pay to them in time.
Investigation also confirmed that the CBN accepts not more than N3,000 of defaced currency for exchange from commercial banks as given point in time.
Investigations also confirmed the fact that CBN is not obliged to give value to notes it does not approve to have fallen into the category they specify.
At New Nigeria Bank Broad Street, an official said they take such money from both customers and non-customers provided they are genuine notes and the numbers are still seen.
According to the official the only problem is that the money has to be collected in large sums and sometimes it is difficult to get them in large quantity.
At the Cooperative and Commerce Bank, Balogun Street, officials said they accept defaced currency only from customers.
A research economist with the United Bank for Africa told The Republic that banks have lots of such notes in their strong rooms.
According to him, most banks have resorted to refusal of such currencies based on the fact that the CBN does not answer banks readily.
He said that in the past, people used to exchange such money at filling stations but with the increasing of defaced currencies, filling stations have refused to accept same too.
The question now is how do people who live far away from CBN exchange their mutilated currencies?
An economist with Union Bank said the faut is with the people who misuse the currency. He said that most Nigerians handle the Nigerian currencies carelessly. So they should pay for it by losing such money. At First Bank the instruction is a flat no to both customers and non customers.