The Central Bank of Nigeria (CBN) has approved a new cheque standard that will introduce new digits on the Magnetic Ink Character Recognition code line and expiry dates for new checkbooks.
Confirming this development in a recent mail by some Banks to its customers titled ‘New features on checkbooks.’ The approved new cheque standard will fully take effect from January 1, 2021.
CBN had earlier emphasized its commitment to ensuring a systematic cheque processing and other paper-based payment instruments through the complete application of new and already adopted technologies in one of its recently released report titled; “Monetary, Credit, foreign and exchange policy guidelines for fiscal years 2020/2021’’. Some of the main features of the new cheque standard are;
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- Space for payee and amount in words
- Date format has changed.
- Location for the amount in figure
- Position of the hologram, tri-thermochromic ink Seal, and Duty stamp Seal Now visible audit number
- Introduction of code line preservation and beneficiary account number space on the reverse of cheques.
- Introduction of cheque Personalizes certification number and addition of production date to Cheque printer Certification number on cheque leaves.
- The new and old cheque Monetary, Credit, Foreign Trade and Exchange Guidelines for Fiscal Years 2020/2021 standards would run concurrently till September 1, 2020. Thereafter, only cheques that conform to the new standards would be allowed in the clearing system. Banks shall continue to conduct annual accreditation of the Nigeria cheque printers and cheque personalizers, in line with the provisions of the revised NICPAS.
In line with the new cheque standard, Banks have started to notify their customers that they will phase out old checkbooks and will no longer honor such by December 31, 2020. Customers are to request new checkbooks from their banks.
The maximum limit on Cheque Standard payment
In other to enhance the efficiency of the payment system in the country, the Central Bank of Nigeria sets a maximum limit on cheque payment at N10 million for a single cheque payment with effect from January 1st, 2010. This means that you can no longer withdraw or make payments above N10 million using a single cheque leaf or by splitting cheques into lower thresholds to exceed the set limit of N10 million.
The policy was applauded by financial analysts who agreed that the policy would reduce fraud in the financial industry as well as limit the use of cash in society. The good news is that banks’ digital platforms offer customers the flexibility of making additional payments above this limit.
Full document below
cheque circular (2) CIRCULAR ON MAXIMUM LIMIT ON CHEQUE PAYMENT0001 (1)