- Regulatory environment
The effectiveness of the MNB’s responsibility and the performance of its basic tasks (affecting cash-related areas) as well as professional and qualitative central bank expectations are ensured by and included in the following provisions of law.
The MNB is responsible for the maintenance of confidence in cash payments, the optimum choice of denominations, the keeping of cash reserves, the supply of the economy with banknotes and coins of adequate quality and the regulation of cash circulation in the market.
The MNB participates in the domestic cash supply chain as a wholesale service provider: banknotes and coins reach the circulation, the end-users through the clients of the Central Bank, i.e. through credit institutions (e.g. commercial banks, mutual savings banks) and the Hungarian Post, within the framework of cash withdrawals debiting these clients’ respective bank accounts and through denomination exchange.
In order to perform its basic tasks listed above, the Central Bank is at the disposal of account holders, the cash processing organisation and retail clients with various cash transactions. The services provided by the MNB are presented at Business terms and Conditions.
The MNB does not deal with the changing or selling and buying of currencies (foreign legal tenders).
In order to facilitate the efficiency of the domestic cash supply, the MNB supports banknote and coin recycling by market participants. However, the businesslike performance of cash processing operations defined – in Subparagraph c) of Paragraph (2) of Article 3 of Act CXII of 1996 on Credit Institutions and Financial Enterprises (hereinafter: ‘CIFE’) – as activities auxiliary to financial services outside the central bank requires the authorisation of the MNB. (The liability for exercising the right of withdrawal of such authorisations also lies with the Central Bank.)
Acting in an official capacity, the Central Bank inspects the professional activity of organisations with authorisation for cash processing and market participants, the continuous existence of the conditions that existed when the authorisation was granted as well as the adequate quality of banknotes and coins returning to circulation and to the MNB. In order to provide cash circulation services that meet the needs of the population, the Central Bank also pays special attention to the control of the relevant operations of credit institutions and post offices, e.g. the performance of denomination exchange activities (also including the exchange of damaged banknotes and coins) and their conditions.
- Regulatory environment