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  • Business - Companies
  • Updated: June 03, 2022

CBN Orders Banks To Accept Indemnity From Customers For Online Transfers Above N1 Million

Banks and Payment Service Providers have been ordered by the Central Bank of Nigeria (CBN) to accept indemnity from customers for highly secured online funds transfers.

This was stated by the CBN in a circular signed by Musa Jimoh, the Director, Payments System Management Department, with the reference number: PSM/DIR/PUB/CIR/01/006, titled ‘Circular on the review of operations of the NIBSS Instant Payments System and other electronic payment options with similar features’, which was released on Thursday.

The circular stated: “Further to the circular on the above reference BSP/DIR/GEN/CIR/01/011 and dated August 13, 2014, banks are hereby required to comply with the following:

“Accept indemnity from customers for highly secured online funds transfer above N1m for individual and N10m for corporate, subject to a maximum of N25m (individual) and N250m (corporate).

“Provide customers with the option of electronic or paper indemnity based on the customer’s preference.

“Implement electronic indemnity with stricter controls requiring biometric verification of identity.

“Adhere to multiple-factor authentication for highly secured online funds transfer.

“Inform and educate customers on the use of indemnity to increase transaction limits where possible.”

Another guideline was also released by the CBN  titled ‘Guidelines for the registration & operation of Bank Neutral Cash Hubs in Nigeria’.

The guidelines stated that BNCHs were cash collection centres to be established by registered (licensed) processing companies or Deposit Money Banks based on business needs.

According to the CBN, the hubs would be located in areas with high volumes of commercial activities and cash transactions.

It further stated that the hubs would provide a platform for customers to make cash deposits and receive value irrespective of the bank with which their account is domiciled.

“This guideline aims to provide minimum standards and requirements for BNCH registration and operations for effective supervision,” the CBN stated.

The CBN explained that the main objective of setting up the BNCH is to deepen financial inclusion, leverage shared services to enhance cash management efficiency, and also to reduce the risks and costs borne by banks, merchants and huge cash handlers in the course of cash management activities.

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Felicia Abisola  Olamiji
Felicia Abisola Olamiji

  A graduate of English Language from Olabisi Onabanjo University, passionate about learning new...

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