April 26, 2019/CBN
1.0 Introduction
1.1 CBN Mandate
One of the core mandates of the Central Bank of Nigeria (CBN) as enunciated in section 2 of the CBN Act, 2007, is the issuance and management of the legal tender currency in Nigeria. The Currency Operations Department (COD) of the CBN is responsible for the discharge of this mandate by ensuring that the volume of banknotes and coins in circulation is sufficient, of good quality and generally acceptable by the public. To achieve this, the Bank manages the currency notes throughout their life cycle. The notes can easily be checked for their genuineness during the period of circulation. The banknotes are also sorted into fit and unfit notes. The fit notes are recirculated while the unfit banknotes are withdrawn, disposed and replaced by new banknotes.
1.2 Definitions
Note Quality Standard
The objective of a banknote fitness standard is to address the following:
- Ensuring that banknotes meet the expectation of the public in terms of cleanliness and appearance;
- Ensuring that basic security features on the banknote remain visible and are easily recognized by the public to deter counterfeiting; and
- Facilitating automated dispensing, counting and sorting of banknotes.
Fit Banknote
A banknote that is suitable for continued circulation and is sufficiently clean to allow its authenticity and value to be readily ascertained.
Unfit Banknote
A banknote that is unsuitable for further circulation because of its physical condition, which may be soiled, dirty, limp, worn out, defaced or has a hole that is larger than 10 mm. Unfit notes should be returned to DMBs or a branch of the CBN anywhere in Nigeria for exchange.
1.3 Guidelines on Quality Standard for the Nigerian Banknotes
These guidelines provide the general public with clear, acceptable criteria and standards for determining the quality of banknotes in circulation. Fitness standards are developed for all denominations of the banknote. These standards establish the desired fitness criteria and parameters for the banknotes which provide a benchmark and reference for evaluating banknotes in circulation. The fitness criteria include:
* The durability and functionality of security features on the notes;
* Banknotes structure and durability; and
* Banknote quality i.e. printing and appearance of the banknotes (soiling/ink wear) etc.
