CENTRAL BANK OF NIGERIA CENTRAL BANK OF NIGERIA VIV Banknote Fitness GUIDELINES

CENTRAL OF CENTR/ 2000 OF P CURRENCY OPERATIONS DEPARTMENT CENTRAL BANK OF NIGERIA CENTRAL BANK OF NIGERIA

CURRENCY OPERATIONS DEPARTMENT CURRENCY OPERATIONS DEPARTMENT CENTRAL BANK OF NIGERIA All Rights reserved. No part of this publication may be reproduced, stored or used in any form or by any means, electronic, mechanical including photocopying, recording or otherwise stored in a retrieval system, without prior written permission of the copyright owner.

Copyright: First Published: 2018 Published By: Currency Operations Department Central Bank of Nigeria

TABLE OF CONTENTS	PAGE
Foreword.	1
1.0 Introduction.	2
1.1 CBN Mandate	2
Definitions	2
1.2
1.3 Guidelines on Quality Standard for the Nigerian Banknotes...... 2
1.4	Banknote Performance Review
1.5	Banknote Quality Standards.
2.0 Classification of Fit notes for Re-circulation.	4
New Banknote.
2.1	4
2.2 ATM Fit	4
2.2a ATM Fit.	4
2.2a ATM Fit.	5
2.2a ATM Fit.	6
2.3 Teller fit.
2.3a Teller Fit	7
2.3a Teller Fit	8
2.3a Teller Fit	9
2.3a Teller fit .	10
3.0 Characteristics of Unfit Banknotes.	11
3.1 Soiling	I J
3.2a Soiling (N1000).	II
3.2b Soiling (N500)	14
3.2c Soiling (₦200)	16
3.2d Soiling (₦100) Commemorative	I a
3.3 Limpness.	22
3.4 Stain	25
3.5 Missing Security Feature.	25
3.6 Graffiti.	26
0

TABLE OF CONTENTS	PAGE
3.7 Hole.	26
3.8	Tear.	27
3.9 Mutilation.	27
3.10 Repair	28
3.11 Crumple/Shrinkage.	28
3.12 Fold	28
3.13 Burnt or Termite Infested.	29
3.14 Composed Banknote	29
3.15 Ink-Wear	30
3.15a Ink-Wear (₦50).	30
3.15b Ink-Wear (₦20).	32
3.15c Ink-Wear (₦10).	32
3.15d Ink-Wear (₦5)	37
3.16 Old Series Design
4.0	Implementation of the Banknote Fitness Guidelines...........	41
5.0	Monitoring the Banknote Fitness Guidelines......................................................	42
6.0 Conclusion.

One of the mandates of the Central Bank of Nigeria is the issuance of legal tender currency in Nigeria. This responsibility entails implicit funcons which include the producon and circulaon of quality banknotes in line with defined standards. Over the years, the Central Bank of Nigeria has been working assiduously to ensure consistency in the quality of notes in circulaon in terms of appearance and cleanliness. Consequently, the Bank in collaboraon with key industry stakeholders produced the Banknote Fitness Guidelines. The document provides acceptable standards for good quality (fit) banknotes and poor quality (unfit) banknotes based on various degradaon levels. Accordingly, the Banknote Fitness Guidelines among other things therein enunciated the following: The quality standards and guidelines for banknotes producon and re-circulaon.

Standardised quality criteria for sorng of banknotes and a guide to all parcipants in the currency management industry.

Processes of withdrawal of unfit banknotes in circulaon.

This document is intended for the use of all cash handlers such as Deposit Money Banks (DMBs); Micro Finance Banks; third party service providers and general public etc. All cash handlers are expected to comply with the quality standards as set therein to sustain public confidence in the naonal currency. It is therefore our privilege to present this document to the general public.

Priscilla E. Eleje (Mrs.) Director (Currency Operaons Department)

FOREWORD Folashodun A. Shonubi Deputy Governor (Operaons) 1 1.0 Introducon

1.1 Cbn Mandate

One of the core mandates of the Central Bank of Nigeria (CBN) as enunciated in secon 2 of the CBN Act, 2007, is the issuance and management of the legal tender currency in Nigeria. The Currency Operaons Department (COD) of the CBN is responsible for the discharge of this mandate by ensuring that the volume of banknotes and coins in circulaon 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 circulaon. 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 Definions

Note Quality Standard The objecve of a banknote fitness standard is to address the following: Ensuring that banknotes meet the expectaon 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 counterfeing; and Facilitang automated dispensing, counng and sorng of banknotes.

· · ·

Fit Banknote

A banknote that is suitable for connued circulaon and is sufficiently clean to allow its authencity and value to be readily ascertained.

Unfit Banknote

A banknote that is unsuitable for further circulaon because of its physical condion, 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 circulaon. Fitness standards are developed for all denominaons of the banknote. These standards establish the desired fitness criteria and parameters for the banknotes which provide a benchmark and reference for evaluang banknotes in circulaon. The fitness criteria include:

• The durability and funconality of security features on the notes;
• Banknotes structure and durability; and
• Banknote quality i.e. prinng and appearance of the banknotes (soiling/ink wear) etc.

1.4 Banknote Performance Review

The banknote review process involves the visual inspecon of samples of notes, using defined inspecon procedures. The process idenfies the level of degradaon in the quality /appearance of the notes, note structure and security features. The note review process which is based on the note performance criteria and standards idenfied in the banknote quality standard provides an evaluaon of the notes in circulaon with regards to:

• Visual quality and funconality of security features * Note structure and quality; and * Visual quality of the prinng features on the notes and note appearance.

1.5 Banknote Quality Standards

A banknote is considered fit for recirculaon if it meets the following criteria: a) Genuine, not counterfeited. b) Has a defined and acceptable area dimension.

c) Free from holes (not above 10 mm), tear, tape or missing part, folded poron, etc.

d) Has uniform brightness and is not heavily soiled. e) Free from excessive ink wear, parcularly in the portrait area. f) Free from defacing. g) Correct denominaon, serial number details, etc. h) The series that has been approved for redistribuon by the Bank. If one of these criteria is not met, a banknote can be classified as unfit and unsuitable for recirculaon.

2.0 Classificaon Of Fit Notes For Recirculaon

2.1 New Banknote

This is a banknote that is newly printed and issued into circulaon for the first me by CBN. Level 1 below shows samples of newly printed notes. All new banknotes are considered as level 1.

2.2 Atm Fit

This is a banknote suitable for ATM replenishment which is mint (newly printed banknotes) or clean notes sorted from banknotes that have been in circulaon. ATMs, bill changers and other self-service currency machines require higher quality banknotes in order to funcon efficiently. Levels 1 & 2 below are considered as ATM fit banknotes. (2.2a)

2.2A Atm Fit

Level 1 Level 2

2.2A Atm Fit

Level 1

CENTRAL BANK OF NIGERIA One Hundred Naira af3718123 AF3718123 at N100 Level 2 CENTRAL BANK OF NIGERIA SHILD One Hundred Naira вкве52232 BK6652232 N100 CENTRAL BANK OF NIGERIA FIFTY of NAIRA a D of TV9556798 ch firm CENTRAL BANK OF NIGERIA FIFT NAIRA D e 2017 T C 8 5 5 0 8 6 7

CENTRAL BANK D e OF NIGERIA 6 TWENTY 0 NAIRA 3 4 2012 a D T 6 4 0 3 5 1 4 0 1 6 4 0 3 5 1 4 CENTRAL BANK OF NIGERIA TWENTY NAIRI 2017 a EA7336020 definin Level 1 Level 2

2.3 Teller Fit

This is a banknote that has been sorted and considered suitable for recirculaon. They are used banknotes that are of lower quality than ATM fit notes but should meet other quality standards to maintain a clean appearance, enhance customer sasfacon and reduce transacon me. Levels 1-5 of the quality standard scales are examples of teller fit banknotes (2.3a).

2.3A Teller Fit

Level 1

CENTRAL BANK OF NIGERIA 1000 Central Bank e a 1000 of Nigeria 537766 Hundred Naira 537766 200 1000 Level 2 Level 2 CENTRAL BANK OF NIGERIA 1000 Acentral Bari 2 40 Nigeria 270520 પ્રવૃત 2013 270520 May 11 1000

Level 3 Level 3

CENTRAL BANK OF NIGERIA 1000 Acentral Bank 1000 Of Nigeria ive Hundred Naira Sundari 500 1000 CENTRAL BANK OF NIGERIA 1000 1000 Level 4 Casinol F of Nigeria SIVE indred Naira #815293

Level 5 Level 5

CENTRAL BANK OF NIGERIA 1000 e Connal Bank of Nigeria =317752 Tive Hundred Natra 31775 2014 500 1000 7

2.3A Teller Fit

兴12575 Central Bank 2 Of Nigeria ª125756 Ired Naira CENTRAL BANK OF NIGERIA Hundred Naira AF3718123 AF3718123 NIOO %120502 Control Bank Of Nigeria 120502 Hundred Naira ENTRAL BANK OF NIGERIA Aco185373 78527 Canaral Ban Of Niger 14/0 CENTRAL BANK OF NIGERIA AR7168112 Level 4 Central Ban Of Nigeria Level 4 ENTRAL BANK OF NIGERIA undred Naira k 6652232 BK6652232 NIO O Central Bank N of Nigeria EB39137 Naira 839137 00 CENTRAL BANK OF NIGERIA AF7710460 8

2.3A Teller Fit Level 1

CENTRAL BANK OF NIGERIA NAIRA TV9556798 Chife Fire CENTRAL BANK D OF NIGERIA

TWENTY NAIRA లా డు a 2018 DT6403514 Olifican Level 2 Level 2 CENTRAL BANK OF NIGERIA FIFUL NAIRA TC8550867 Chife Films CENTRAL BANK V.

OF NIGERIA ooww WENT NAIRA 0 2017 EA7336020 chiffician Level 3 CENTRAL BANK OF NIGERIA FIFTY NAIRA ( TK0321194 Chife from Level 3 CENTRAL BANK OF NIGERIA TWENTY NAIRA DW1929708 artito Level 4 CENTRAL BANK OF NIGERIA FIFA NAIRA T N 9 9 2 2 0 8 7 CENTRAL BANK OF NIGERIA FIFTY NAIRA 8 A2284018 chite CENTRAL BANK OF NIGERIA TWENTY 201 DV2145042 Chifficial Level 5 CENTRAL BANK OF NIGERIA ann TWENTY DZ2463884 Yolward Alma

2.3A Teller Fit

Level 1 Level 1 CENTRAL BANK CENTRAL BANK AN OF NIGERIA OF NIGERIA o your FIVE 1135 NAIRA NAIRA 2016 EG5870525 EN2173782 Shfrim creen Level 2 Level 2 CENTRAL BANK CENTRAL BANK B OF NIGERIA OF NIGERIA FIVE B NAIRA w 0 8 E F 3 0 7 9 8 0 5

BL1081308 chifting Level 3 Level 3 CENTRAL BANK CENTRAL BANK OF NIGERIA OF NIGERIA FIVE

NAIRA 2012 D U 7 3 6 2 7 2 5 D U 7 3 6 2 7 2 5 DT9092120 Oh Sep Level 4 Level 4 CENTRAL BANK CENTRAL BANK OF NIGERIA OF NIGERIA OEN FIVE

2017 EH8246821 774194 Di Oh FF Level 5 Level 5 CENTRAL BANK CENTRAL BANK D OF NIGERIA OF NIGERIA സ്ഥാപന്തമ FIVE

3 e NAIRA DZ4856226 DH2489418 Chiffin Olyphone

3.0 Characteristics Of Unfit Banknotes

3.1 Soiling

Soiling is one of the characteriscs of unfit banknotes. A Naira banknote is soiled when there is general distribuon of dirt or moisture across it. Soiling is observed in the appearance of banknotes when the white and lighter coloured areas of the note become darker. As the soiling level increases, the banknotes become visually 'dirty'. Soiling of notes is evaluated on the following scale of levels 1-9, with levels 1-5 considered fit, while levels 6-9 are unfit (3.2a - 3.2d).

3.2A Soiling (N1000)

Level 1 Fit Level 2 Fit

CENTRAL BANK OF NIGERIA 1000 1000 2014 Level 3 Fit

CENTRAL BANK OF NIGERIA 1000 2014 Level 4 Fit

CENTRAL BANK OF NIGERIA 1000 2014 Level 5 Fit

CENTRAL BANK OF NIGERIA 1000 2010 NAIRA Level 6 Unfit

CENTRAL BANK OF NIGERI 1000 ONE THOUSAND NAIRA Level 7 Unfit

CENTRAL BANK OF NIGERI. 1000 NE THOUSAND NAIRA Level 8 Unfit

NTRAL BANK OF NIGERI 1000 NAIRA FHOUSAND 1000 Level 9 Unfit

3.2B Soiling (₦500)

Of Niger $537766 766 Level 1 Fit

270520 270520 Level 2 Fit

Centine 550904 Level 3 Fit

815293 #815293 Level 4 Fit Level 5 Fit Level 6 Unfit Level 7 Unfit Level 8 Unfit

3.2B Soiling (N500)

Level 9 Unfit

3.2C Soiling (N200)

Level 1 Fit Level 2 Fit

3.2C Soiling (N200)

Level 3 Fit Level 4 Fit Level 5 Fit Level 6 Unfit

3.2C Soiling (N200)

Level 7 Unfit Level 8 Unfit Level 9 Unfit

3.2D Soiling (₦100) Commemorative

CENTRAL BANK OF NIGERIA One Hundred Naira AF3718123 2014 A F 3 7 18 12 3 (0) Of Level 1 Fit

F NIGERIA BK6652232 BK6652232 Level 2 Fit

OF NIGERIA AR 7 168 1 12 AR7168112 Level 3 Fit

co185373 ACO185373 Level 4 Fit

3.2D Soiling (N100) Commemorave

Level 5 Fit Level 6 Unfit Level 7 Unfit Level 8 Unfit

3.2D Soiling (₦100) Commemorative

ENTRAL BANK OF NIGERIA One Hundred Naira Ac8205292 C8205292 Level 9 Unfit

3.3 Limpness

Limpness is the breakdown of the structure and texture of a banknote from crisp paper note to a flexible and weak banknote. A crisp new banknote when held will be straight at about 0 degree. As the limpness increases, the note becomes more flexible and the angle of drop increases. The angle of drop of the banknotes in levels 1-5 below falls from 0 to about 74 degrees. Banknotes in this category are classified as fit. From levels 6 to 9, the angle of drop is from 75 to 90 degrees. Banknotes in this category are classified as unfit.

Level 1 Fit 0 0 Level 2 Fit 0 17 2014 AR7168112 NIOC Level 3

CENTRAL BANK OF NIGERIA Fit One Hundred Naira AR 7 168 1 12 nary 1914 2014 27° Level 4 2014 AC0185373 CENTRAL BANK OF NIGERIA One Hundred Naira Fit Aco185373 Centenary 1914-2014 49° Level 5 CENTRAL BANK OF NIGERIA Fit One Hundred Naira AF7710460 2014 ntenary 1914-2014 74° AF7710460 NIO O

3.3 Limpness

Levels 6 to 9 are classified as unfit banknotes.

Level 6 TRAL BANK OF NIGERIA lundred Naira Unfit R 5452899 75° Level 7 NTRAL BANK OF NIG Unfit Hundred Naira 84° Level 8 TRAL BANK OF NIGERIA Unfit undred Naira 5978563 86° AD5978563 Level 9 Unfit NTRAL BANK OF NIGERI Hundred Naira AC8205 90 AC8205292

3.4 Stain

This is a banknote with localized concentraon of dirt on any part or the whole of the banknote.

3.5 Missing Security Feature

This is a banknote with one or more missing security features or is defecve through manual visual inspecon.

MISSING SECURITY THREAD

3.6 Graffi

This is a banknote with added image or leering wrien or marked in any manner on the Naira banknote.

GRAFFITI

3.7 Hole

This is a banknote exhibing at least one visible hole. If the area of the hole is larger than 10 mm, the banknote is considered unfit.

HOLES

3.8 Tear

This is a banknote with tear(s) of a size more than 5 mm on any part of the note (where missing corners are easily detectable).

3.9 Mulaon

This is a banknote with part(s) missing, along at least one edge (in contrast to holes). Naira banknotes with lengths and widths reduced are unfit.

MUTILATION

3.10 Repair

This is a banknote with its part(s) joined together by tape, glue or staple pins.

REPAIR

3.11 Crumple/Shrinkage

This is a banknote with mulple random folds across the enre banknote that strongly affect its visual appearance. It includes shrinkage of the note due to excessive exposure to heat.

12 CRUMPLE/ SHRINKAGE

3.12 Fold

This is a banknote with excessive folding such that a part of it covers another.

FOLD

3.13 Burnt Or Termite Infested

This is a banknote with damage caused by fire, heat, termites, mildew or mold.

BURNT OR TERMITES INFESTED

3.14 Composed Banknote

This is a banknote in which parts of different banknotes are joined together.

COMPOSED BANKNOTE

3.15 Ink- Wear

This is a polymer banknote with improper reflecon of the printed areas. This could be due to inadequate ink on any part or whole of the Naira banknote or as a result of aging, excessive folding, wear or washing.

3.15A Ink-Wear (N50)

Level 1 Fit Level 2 Fit Level 3 Fit

3.15A Ink-Wear (N50)

Level 4 Fit Level 5 Fit Level 6 Unfit Level 7 Unfit 3.15a Ink-Wear (N50) Level 8 Unfit Level 9 Unfit

3.15B Ink-Wear (N20)

Level 1 Fit Level 2 Fit Level 3 Fit Level 4 Fit Level 5 Fit Level 6 Unfit

3.15B Ink-Wear (N20)

Level 7 Unfit Level 8 Unfit Level 9 Unfit

8 EG5870525 on 9 Level 1 Fit

EF3079805 Level 2 Fit

DT9092120 Oh fififilm Level 3 Fit

H 024 No H8246821 Level 4 Fit Level 5 Fit Level 6 Unfit Level 7 Unfit Level 8 Unfit

x 7381332

Level 9

Unfit

3.15D Ink-Wear (₦5)

CENTRAL BANK OF NIGERIA G NNOUTA NAIRA 2016 EG4592277 Oh formers Level 1 Fit

DX4199564 Ob fram Level 2 Fit

EN2173782 Level 3 Fit

CENTRAL BA B OF NIGI BL1081308 Chiffician Level 4 Fit

OF NIC LAIRA DU7362725 o Level 5 Fit

IAIRA DW2774194 Level 6 Unfit

a colle AIRA H2489418 Level 7 Unfit

CENTRAL BANK OF NIGERIA NAIRA PG4099575 clife Level 8 Unfit

CENTRAL BAN OF NIGERIA F/VE NAIRA Level 9 Unfit

3.16 Old Series Design

These are banknotes that have already been withdrawn from circulation by the Central Bank of Nigeria (CBN).

Å 497350 497350 S 68062 604022 BANK OF NIGER RENTRAL

• 191 ANK OF NIGERIA #600347 #600347 OLD SERIES DESIGN

4.0 Implementaon Of The Banknote Fitness Guidelines

In line with the provisions of these guidelines, stakeholders should take the following steps to ensure that the banknotes in circulaon are of acceptable quality standard: The quality of banknotes must be checked in the course of withdrawal by all the major cash handlers.

41 The DMBs and third party service providers are advised to adhere strictly to the provisions of the Guidelines as any violaon would aract appropriate sancons.

Fit banknotes should be re-circulated to the public, while unfit banknotes are to be returned to CBN for authencaon and disposal.

All banknote processing machine parameters must be configured in line with the quality criteria set by the Bank to ensure consistent quality output.

Cash handlers (DMBs, Micro-Finance Banks, etc.) shall pay only fit banknotes to the public. In a situaon where the demand for banknotes exceeds the available stock of fit notes, the issue should be escalated to the Issuing Authority (CBN) for necessary acon.

The Central Bank of Nigeria would connue to sensize the public on the basic security features of the notes, the dangers of sale of the Naira and proper handling habits of the banknotes by the public. Any abuse of the Naira is a criminal offence, punishable under the CBN Act of 2007.

5.0. Monitoring The Banknote Fitness Guidelines

The Central Bank of Nigeria would periodically gauge the effecveness and compliance with the Banknote Fitness Guidelines. The Currency Operaons Department would conduct roune monitoring of cash handlers with a view to: Determining the adherence of the cash handlers to the specificaons of the fitness standards.

Gauging stakeholders' deviaons from the fitness standards. Ensuring that deviaons are within the acceptable tolerance. Determining the quality of banknotes in circulaon by random sampling. Obtaining feedback and document findings for connuous improvement. The Central Bank of Nigeria shall enforce compliance with the Banknote Fitness Guidelines by all cash handlers.

6.0 Conclusion 42

The guidelines aim at ensuring that only fit banknotes are in circulaon while unfit banknotes are withdrawn. Unfit banknotes may be deposited at the branches of Deposit Money Banks (DMBs) and Central Bank of Nigeria naonwide. The Central Bank of Nigeria has the sole responsibility to dispose all unfit banknotes and replace them as appropriate. This document will be reviewed and updated periodically by the Central Bank of Nigeria. All enquiries on the Banknote Fitness Guidelines should be channeled to the Director, Currency Operaons Department, Central Bank of Nigeria, Abuja.

Currency Operaons Department Central Bank of Nigeria 33, Tafawa Balewa Way Central Business District P.M.B 0187 Garki , Abuja Phone: +234 (0)946238544 Fax: +234(0)946236012 Website: www.cbn.gov.ng CENTRAL BANK OF NIGERIA

97837 Central anyt OFNICERIA PART CENTRAL BAS OF NIGERIA TWENDLA NIGERIA CENTRAL BANK o NAIRA S E 0943406 E 0943406