CBN Proposes 5-Year Ban for Nigerians Who Repeatedly Issue Dud Cheques

• The CBN has released a draft guideline proposing a five-year ban for customers who issue dud cheques three times
• Blacklisted individuals will be barred from credit facilities, current accounts, and the cheque clearing system, while banks that fail to enforce the sanctions will be fined
• Banks must retrieve unused cheque leaves, report offenders to credit bureaux, and comply with enforcement measures

Oluwatobi Odeyinka is a business editor at Legit.ng, covering energy, the money market, tech and macroeconomic trends in Nigeria.

The Central Bank of Nigeria (CBN) has unveiled a draft policy proposing a five-year ban on individuals who repeatedly issue dud cheques.

This is according to the exposure draft of the CBN’s ‘Guidelines on the Treatment of Dud Cheques’, released on Monday, Vanguard reported.

In the proposed guidelines, the CBN defines a “serial dud cheque issuer” as any customer who issues cheques that bounce on three occasions due to insufficient funds.

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The apex bank said the proposed guidelines aim to strengthen financial discipline and safeguard the integrity of the cheque clearing system.

According to the document, individuals blacklisted under the rule would lose access to the cheque clearing platform, be barred from obtaining credit from any bank, and be prevented from opening current accounts for a period of five years.

Banks are also required to impose standard returned cheque charges as contained in the national Guide to Charges.

The CBN directed commercial, merchant, non-interest, mortgage and microfinance banks to enforce the sanctions, retrieve unused cheque booklets from affected customers, and upload their details to the Credit Risk Management System (CRMS) and at least two licensed private credit bureaus.

The draft guideline also contains tougher penalties for customers who return to the system and issue another dud cheque after completing a previous ban, stating that each repeat offence will attract an additional five-year restriction.

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The CBN noted that a customer can only be removed from the blacklist after the sanction period expires or where a financial institution confirms that a previous report was made in error.

Upon unbarring, banks must notify the customer and update the credit bureaus accordingly.

In addition, banks that fail to enforce the provisions will face penalties, including a minimum fine of N5 million for not applying restrictions and N3 million for opening a current account without first checking a customer’s CRMS status.

There have been numerous reported cases of businesses being scammed through cheque fraud, as they release goods or services prematurely, only to be informed at the bank that the cheque is invalid.

Banks suspend instant alerts for cheques

Legit.ng earlier reported that the central bank directed banks to stop instant alerts for cheque payments from other banks until the cheques are fully processed and cleared.

The CBN directive issued in August 2025 was aimed at strengthening financial security and reducing losses from fraudulent cheque issuers.

In messages sent to their customers, commercial banks said withholding alerts until funds are officially cleared will protect both parties involved in cheque transactions.

Source: Legit.ng