• Thu. Mar 30th, 2023

    Redesigned Naira notes: Scarcity persists ahead of CBN deadline


    Jan 23, 2023


    Ahead of the January 31 deadline set by the Central Bank of Nigeria (CBN) for some of the old currency denominations to cease to be legal tender, scarcity of the redesigned N1,000, N500 and N200 banknotes still persists nationwide.
    On Sunday, most bank customers decried the continued distribution of the old banknotes by Deposit Money Banks (DMBs) and other Financial Institutions (OFIs) despite the apex bank directives on the issue.
    A survey by the News Agency of Nigeria (NAN) in Abuja revealed that most of the banks were still dispensing the old notes to their customers few days to the expiration of the CBN deadline.
    A civil servant, Ibrahim Abbas, who decried the continued dispensing of the old banknotes told the newswire the banks have continued to issue the old banknotes load over the counters and through their Automated Teller Machines (ATMs).
    “This is not right. They have no reason to do that. But the (banks) say they have devised a way of circulating the new banknotes by asking their customers to bring their old Naira notes to exchange for the redesigned denominations.
    Another bank customer, Suleman Aliu, expressed fears that the delay in flooding the banks with the new Naira banknotes close to the CBN deadline may result in some bank customers losing their money they are not able to exchange before January 31.
    “If the deadline is January 31, which is nine days from today, and the banks are still supplying the old banknotes, it means they want some people to lose their money, ” he lamented
    A Point of Sale (PoS) operator, who spoke on condition of anonymity, criticized the handling of the issuance of the redesigned banknotes by the apex financial system regulatory authority, saying it should have done better.
    “The CBN is telling Nigerians there are enough of the redesigned bank notes in vaults of the DMBs, but the banks are saying they do not have enough supply of the banknotes. Something is not adding up here,” he said.

    Following the announcement in October 2022 of the plan to redesign and reissue some denominations of the currency, the CBN had fixed January 31 as deadline for the old banknotes to cease to circulate in the country as legal tenders.
    However, the apex bank insisted it has since mandated the DMBs to ensure the issuance of the new banknotes strictly through their ATMs, which means customers who take the old banknotes to the bank to exchange can only get the equivalent of the redesigned banknotes through the ATMs.

    In a statement on Friday jointly signed by the Director, Banking Supervision Department, Haruna Mustapha, and the Director, Payment System Management Department. Of the CBN, Musa Jimoh, the CBN said the mandate was to ensure that distribution of the new currency notes was fair, transparent, and evenly spread across the country.

    The CBN also allayed the fears of rural dwellers that they may not be able to access the new banknotes before the expiration of the January 31 deadline.
    Announcing plans to inaugurate a cash-swap programme in rural and underserved areas of the country on Monday, the CBN said this would boost the collection of the redesigned Naira notes across the country .

    The apex bank said that the inauguration was informed by the need to maximise the channels through which underserved and rural communities could exchange their naira notes.
    The cash-swap programme would be operated in partnership with DMBs and super agents across the country.

    “The old N1,000, N500 and N200 notes can be exchanged for the redesigned notes or existing lower denominations of N100, N50 and N20 which remain legal tender.
    “The super agents can exchange a maximum of N10,000 per person, while amounts above N10,000 shall be treated as cash-in deposit into wallets or bank accounts in line with the cashless policy.
    “Bank Verification Number, National Identification Number or Voter’s Card details of the customer should be captured as much as possible,’’ the CBN said.

    Also, the CBN had earlier disclosed that it ordered the printing of 500 million pieces of the new Naira notes in the first contract, which rolled out in the last week of December 2022.
    The Deputy Governor, Financial System Stability, Aisha Ahmad, who disclosed this while speaking before a House of Representatives hearing on implementation of CBN cashless policy and the new withdrawal limits, said there were 31 DMBs with 4,603 branches in the country as at October 2022.

    “In the OFIs sector, there are 878 Microfinance Banks with1,966 branches; 1.4 million agents; 899,642 PoS terminals, and more than 14,000 ATMs,” she said.
    A review of the cost of currency management from 2017 to 2021 revealed an average increase of more than N10 billion per annum.
    Ahmad said over 90 percent of currency management costs were attributed to banknotes production.

    Meanwhile, the Nigeria Governors’ Forum (NGF) says it has set up a six-member committee to engage the CBN on ways to address the anomalies in the country’s monetary management and financial system.
    The Forum disclosed this in a communique issued on Saturday after a virtual meeting held with the CBN Governor, Godwin Emefiele, on Thursday night.
    The NGF Chairman, who is also the governor of Sokoto State, Aminu Tambuwal, said in the communique that members of the committee, chaired by the Anambra State Governor, Charles Soludo, include the governors of Akwa Ibom, Ogun, Borno, Plateau and Jigawa states.

    The governors said while they were not opposed to the objectives of the Naira redesign policy, the apex bank should consider the peculiarities of households and states, especially pertaining to financial inclusion and under-served locations.

    “We, the members of the NGF, received a briefing from the Governor of the CBN, Emefiele, on the Naira redesign, its economic and security implications, including the new withdrawal policy.
    “Governors are not opposed to the objectives of the Naira redesign policy. However, we observe that there are huge challenges that remain problematic to the Nigerian populace.
    “In the circumstances, governors expressed the need for the CBN to consider the peculiarities of states, especially as they pertained to financial inclusion and under-served locations,” the NGF said in its communique.

    The governors expressed resolve to work closely with the CBN leadership to ameliorate areas that required policy variation, particularly the poorest households, the vulnerable in society and several other Nigerians that were excluded.

    The governors also resolved to collaborate with the CBN and the Nigerian Financial Intelligence Unit (NFIU) in advancing genuine objectives within the confines of the laws.
    They, however, insisted that the recent NFIU Advisory and Guidelines on cash transactions were simply outside the NFIU’s legal remit and mandate. (NAN)

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