The Central Bank of Nigeria (CBN) is set to introduce a stringent new policy that will impose a five-year ban on individuals identified as serial issuers of dud cheques. This is contained in the exposure draft of the proposed Guidelines on the Treatment of Dud Cheques, which outlines tougher regulatory measures aimed at curbing cheque-related fraud.
Under the draft guidelines, a customer will be classified as a serial offender after issuing dud cheques on three separate occasions due to insufficient funds. Once flagged, the individual will be blacklisted—barred from accessing the cheque clearing system, obtaining credit facilities, or opening current accounts for five years. Banks must also apply applicable returned-cheque charges as stipulated in Nigeria’s Guide to Charges.
All commercial, merchant, non-interest, mortgage, and microfinance banks are mandated to strictly enforce the sanctions. Offenders’ unused cheque booklets must be retrieved, with their details filed in the Credit Risk Management System (CRMS) and reported to at least two private credit bureaux.
The CBN also proposes harsher consequences for repeat offenders: anyone who issues another dud cheque after completing a previous five-year penalty will incur an additional five-year sanction for every new violation.
Unbarring will occur only after the sanction period lapses or if a financial institution confirms that a dud cheque was recorded in error. Institutions must then update the customer’s status with credit bureaux and issue formal clearance.
Banks that fail to comply with the guidelines will face steep penalties—₦5 million for ignoring restrictions and ₦3 million for opening current accounts without CRMS checks.
