• Wednesday, April 24, 2024
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New naira bundles sprayed at parties as ATMs run dry

How not to implement policies – Lessons from the naira redesign debacle

While many Nigerians are complaining of scarcity of redesigned naira, a video making rounds on social media shows bundles of mint new naira notes being sprayed at a party.

The redesigned naira, which was rolled out on December 15, 2022 has scarcely been seen and used by many Nigerians, even as the deadline for the phase out of the old notes nears.

Godwin Emefiele, governor of the Central Bank of Nigeria (CBN) has insisted that commercial banks have enough naira notes.

BusinessDay gathered that after the roll out of the new naira some partygoers, high net worth customers, also known as priority customers of lenders, and currency traffickers collaborated with bank staff to mop up large amounts of the redesigned naira notes.

“When I travelled to the village during the festive period, I called one of my sisters working in the bank to bring some new naira notes worth N300,000 but she brought only N150,000 for me,” a Lagos based businessman said.

Commenting, Muda Yusuf, chief executive officer of The Centre for the Promotion of Private Enterprise (CPPE), said, “It is not about hoarding, it’s not adequate. You cannot achieve a cashless policy by confiscating peoples’ money.”

BusinessDay went on a visit to banks, PoS operators, ATMs and to hear from consumers across the country on Friday.

Residents of Aba, the commercial hub of Abia State, Friday, besieged various commercial banks in the commercial city to change their old Naira notes of N1,000, N500 and N200 notes to beat the January 31, 2023 deadline, fixed by the CBN for withdrawal of old notes.

This is also as traders and supermarkets in the city have stopped accepting old notes, against CBN directive that old Naira notes will still be legal tender till January 31, 2023.

Nigerian banks have extended their operations to Sunday for deposit collection, ahead of the deadline for phasing out of the old naira notes on Tuesday.

Emefiele had said that there are no plans to shift the January 31, 2023 deadline for the phasing out of the old naira notes. He said that the policy is being pushed by the CBN to help it effectively drive monetary policy goals which have been largely undermined by the huge currency still outside the banking system.

There is a scramble for the redesigned naira notes on Friday in the Federal Capital Territory as the January 31 deadline nears, but the redesigned notes are still scarce especially in communities.

More so, the old notes are facing growing rejection among individuals and businesses in the capital city, a situation that has left residents frustrated and desperate for the new notes.

“The new notes are very scarce here. In fact, 90 percent of the transactions are still being done with the old notes, “Princess Kelechi, a resident in Bwari told BusinessDay in a telephone interview.

“Yesterday (Thursday) I went to the market and the old notes were the most dominant, everybody is still using the old notes here because the new ones are so hard to see,” she added.

BusinessDay’s visit on Friday showed that ATM machines dispensing the new notes were mostly in Abuja municipal, while very few or no machines were dispensing in communities across other area councils of the FCT. As a result, ATMs were crowded; residents endured long queues to get money. In Bwari, as at the time of filing this report, only one machine was dispensing, but not consistently as it often runs out of cash.

In ihie community, Abia state, businesses and residents were rejecting the old notes leaving those who still have them stranded, in addition to the fact that the new stresses are still scarce.

Adaku Okafor, a resident and petty business owner, narrated to BusinessDay how the situation has crippled her business and income.

“I took the old notes to the last market and I could not transact with it, nobody was accepting it. All my funds are in the old notes, I do not have a bank account to deposit it in, and even POS agents here are not accepting it. Currently, I have just N1,000 new notes left which my children gave to me during the festive period, and I am depending on it till I find a way to change these notes,” she told BusinessDay in a telephone interview.

“I am in a dire situation right now and the worst part is that the new notes are still scarce. My daughter offered to send me some money but no POS is currently dispensing new money around me, and I heard those who have it are charging very high, “she cried.

Read also: Chaos looms as old naira notes phase out nears

Another resident in the community who identified herself as Adaugo said that she has not been able to stock her house with foodstuffs because she does not have enough of the new notes and they are still very scarce in the community.

“You can’t buy anything; you can’t do anything if you don’t have the new money. They are rejecting it here,” she said.

Also, POS agents who do not have new notes are suffering low patronage as they decried that getting the new notes has been difficult.

Point of Sale operators in Akure, the Ondo state capital, have lamented the scarcity of the new redesigned naira notes saying banks were not making the new notes available for them in the state.

The PoS operators, who spoke with our Correspondent on Friday, however, said, non-availability of the notes made most of the customers reject the old notes from them.

“Besides, we don’t see enough N200, and N500 notes while the N1000 is more in circulation than other notes and we always take the old notes to the bank in order to change it to the new one,” they said.