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Third party cheque policy takes off June 1

By on March 14, 2013

The Central Bank of Nigeria (CBN) has ordered all banks to implement the policy on third party cheque withdrawal limit with effect from June 1, 2013, in a move to ensure uniform compliance by all the financial institutions across the country.

The directive became necessary as the apex bank observed that the policy, which was piloted in Lagos, worked effectively, with reduction in cheque related cases of fraud, while boosting the national financial inclusion drive.

CBN had earlier directed that third party cheques above N150,000 shall not be eligible for encashment over the counter, while charges were made on cheques below the same amount.

Third party cheque is a cheque presented for payment by another person other than the issuer.

According to a statement from the bank and signed by the Director of Banking and Payments System Department, Dipo Fatokun, the regulator, “in recognition of its role in the development of an efficient payments and settlement system, undertook some major initiatives to modernize the system.

“All banks are hereby directed to ensure the implementation of N150,000 limit on third party cheques that could be cashed over the counter nationwide, with effect from June 1, 2013.”

“It has been observed that some banks charge their customers in respect of payment of third party cheques below N150,000, cashed over the counter.

“By this circular, all banks are hereby directed to stop charging their customers for third party cheques of up to N150,000 cashed over the counter. ”