CBN Imposes N10 Million Penalty on Banks Using Unaccredited Cheque Printers
Nigeria's central bank has introduced stringent penalties under its revised sanctions regime, targeting commercial banks that bypass accredited cheque printing standards in a move to strengthen payment system integrity.
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The Central Bank of Nigeria (CBN) has imposed a N10 million fine on commercial banks found using unaccredited cheque printers or personalisers, according to its revised sanctions regime released this week. The penalty forms part of enhanced enforcement measures under the Nigeria Cheque Standard and Nigeria Cheque Printers' Accreditation Scheme (NICPAS).
The apex bank's directive, disclosed in updated compliance guidelines, mandates immediate withdrawal of cheques produced by non-accredited vendors in addition to the monetary sanction. The move targets banks that circumvent the accreditation framework designed to maintain security standards across Nigeria's payment infrastructure.
According to Vanguard News, the CBN's revised sanctions regime specifically addresses defaulters of cheque printing standards, with the N10 million penalty representing a significant escalation in enforcement action. The central bank has maintained the NICPAS framework since its introduction to regulate cheque production quality and prevent fraud within the banking system.
The accreditation scheme requires all cheque printers and personalisers serving Nigerian banks to meet technical specifications covering paper quality, security features, and production processes. Banks must verify their vendors hold valid NICPAS accreditation before procuring cheque books or related materials.
Nigeria's banking sector has faced mounting pressure to strengthen operational compliance across multiple regulatory fronts. The CBN has intensified supervision following a series of infractions ranging from foreign exchange violations to anti-money laundering breaches that resulted in combined penalties exceeding N5 billion across the industry in 2025.
The cheque printing sanctions arrive as the central bank continues its broader regulatory tightening campaign. In recent months, the CBN has issued penalties for breaches involving cash handling limits, know-your-customer requirements, and reporting obligations. The regulator has emphasized that compliance failures undermine financial system stability and erode public confidence in banking institutions.
Industry analysts note the N10 million fine represents approximately 0.01% of Tier-1 capital for Nigeria's largest banks but carries reputational risk that extends beyond the financial impact. Banks face potential customer attrition if cheque security is perceived as compromised, particularly among corporate clients who rely on cheque payments for high-value transactions.
The NICPAS framework addresses persistent challenges with cheque fraud, which cost Nigerian banks an estimated N2.3 billion in 2024 according to Nigeria Inter-Bank Settlement System data. Unaccredited printers may produce cheques lacking advanced security features including microprinting, watermarks, and chemical-reactive paper that prevent alteration and counterfeiting.
Commercial banks now face a compliance window to audit their cheque procurement processes and terminate relationships with unaccredited vendors. The CBN has not disclosed how many institutions currently face penalties under the revised regime, though banking sources suggest the directive follows specific infractions identified during recent examinations.
The central bank's enforcement action extends beyond cheque standards. The CBN recently clarified its role in setting cargo clearance rates for import-export valuation, asserting authority over exchange rate determination for customs purposes. This intervention addresses disputes between importers and customs officials over applicable rates for duty calculations.
Nigeria's regulatory landscape has grown increasingly complex as the CBN balances multiple policy objectives including inflation management, exchange rate stability, and financial sector supervision. The apex bank has deployed sanctions as a primary enforcement tool, with penalty revenues directed to the Consolidated Revenue Fund.
Banking sector compliance costs have risen substantially as institutions invest in systems upgrades, staff training, and third-party audits to meet evolving CBN requirements. The largest Nigerian banks allocated between N8 billion and N15 billion each to regulatory compliance in 2025, representing 3-5% of operating expenses according to annual financial statements.
The cheque printing penalties signal the CBN's determination to enforce standards across all payment channels despite the declining volume of cheque transactions. Electronic payment channels now account for 94% of transaction value in Nigeria's banking system, yet cheques remain prevalent for specific use cases including government payments, legal settlements, and large corporate transfers.
Market participants expect the CBN to continue refining its sanctions framework as part of ongoing efforts to align Nigerian banking regulation with international best practices. The central bank has indicated plans to review penalty structures across multiple compliance categories during 2026, potentially introducing risk-based sanctions that scale with institution size and violation severity.