• Thursday, November 07, 2024
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Naira notes swap: How do we get out of the quagmire?

The last three months in Nigeria have been eventful because of political campaigns and the need to change from old Naira notes to new ones. At the time of writing this article, there is rising anxiety and suspicion across the country as the deadline for Naira notes swap draws closer. What some analysts considered a very simple endeavour – bring in old Naira notes and collect new ones – have turned sour and generated controversies.

The new Monetary policy is now something else. We are now using Naira to buy Naira through the use of Point of Sales (PoS) machines as most ATM machines can only dispense few naira notes. In fact, there are few Naira notes – old and new – in circulation. If you want N100,000 you will pay the PoS agent N125,000 only, according to a reliable source.

The Central Bank of Nigeria (CBN) we learnt was aware that many PoS agents were engaged in sharp practices by charging customers up to 30 percent before giving them money. Accordingly, the CBN has threatened to seize PoS agents’ licenses.

Why blame Nigerians

The CBN has tactfully absolved itself from the scarcity of both new and old naira notes. The apex bank has attributed hoarding of the new Naira notes by Nigerians as being responsible for its scarcity, and not that small quantity was issued out.

One is grateful that eminent Nigerians, particularly elder statesmen have reminded the CBN that most people had already deposited all that they had on January 30 as early pronounced in anticipation to start spending the new notes on February 1. Nigerians were hoping that the new notes will be available, but it’s not so. If the CBN wants the policy to be received with open arms and be successful, it should make the new notes available for people to spend. It’s very simple.

Discordant Tunes

The Supreme Court on Wednesday temporarily halted the move by the Federal Government to ban the use of the old naira notes from February 10, 2023. The suit was filed by three states – Kaduna, Kogi and Zamfara States, all in the northern part of Nigeria and controlled by the ruling All Progressives Congress (APC).

In a twist, the FG asks Supreme Court to dismiss states’ suit.” The FG’s filings came hours after the Supreme Court issued an order temporarily halting the CBN’s plan to end the use of the old currency notes on 10 February. The FG has called on the Supreme Court to dismiss a suit challenging the 10 February deadline set by the CBN to end the legal tender status of the old versions of some newly designed currency notes. It argues that the Supreme Court lacks jurisdiction to hear the suit.

Kano State Governor, Dr Abdullahi Ganduje, has dragged the FG to the Supreme Court. Ganduje has alleged that the elements of the annulled June 12, 1993, presidential elections are regrouping and dangerously masquerading in the prevailing crisis generated by the Naira notes swap policy to scuttle the nation’s hard – earned democracy.

The Ondo State Governor, Arakunrin Akeredolu has joined his counterparts from Kaduna, Zamfara and Kogi states in the suit against the FG and the CBN. The Ondo State Governor asks the Supreme Court to stop the FG from implementing its policy on the redesign of the Naira and limiting of daily cash withdrawals by bank customers.

But a public intellectual wanted to know why all these discordant tunes with the Supreme Court Injunction to extend the 10 February 2023 cap on old 1000, 500 and 200 Naira notes circulation? It is very curious that all the while the 100, 50, 20 and 10 Naira notes have remained invisible. As the old Naira notes are passing away, the new notes are scarce. How does a monetary system work without smaller denominations, especially for obtaining change and proper accountability?

One can smell too many ‘dead rats’ and therefore call on patriotic citizens with ‘reach’ to tell those in authority to find a seamless way of getting us out of this quagmire! We need to get out of this quagmire very fast.

The countries with cashless economies did not get there by executive fiat but by providing the necessary infrastructures and enabling environment, with the system operating side by side with the old. When the economy has sufficient buffer to absorb any shocks it makes the cashless more attractive and safe.

Naturally people will gradually migrate to it over time with all the attendant benefits. Here in Nigeria, our mighty CBN wants to do it in 6 weeks? Over one trillion naira was deposited, only a little over 300 billion Naira by the CBN was issued, and insisting people should use electronic channels, with over 60% of the population without bank accounts(fig provided by CBN. And under 55% communication network coverage (according to national communication commission). I’m waiting patiently to see how it works.

It seems anarchy is knocking as banks are being invaded, others closing and the powers that be are pretending all is well. When the branch manager of one of our banks was transferred through a barb-wired fence in order to escape mob attack, I knew there was problem in town.

Losers in the political chess game

But who are losers in the political chess game? Governors, Politicians and so-called Cabals are same pieces of the Political Chess Game Board. If you ask me, real losers are the stunted citizens – the downtrodden on whose Hearts and Minds the games are played.

Nigerians have been going through hardships in getting their hands on the new naira notes as the February 10 deadline approaches. This has led to attacks on some banks in the state, as states like Edo and Oyo have witnessed protests that degenerated into riots.

Recently, banks have been subjected to violent attacks. In Ibadan, a Wema Bank branch was vandalised when riots broke out over the weekend. This has led to increased insecurity and caution around many banks.

Read also: New naira notes: NECA advises on way forward

Financial experts are of the view that: “The banking industry, is wrongly being set up as the fall guy for this incompetent roll-out . If this is not checked, the consequences are dire.”

They argued strongly that since the Naira redesign policy started, banks have been at the receiving end of the frustration of Nigerians. As the Naira scarcity persists, some banks are shutting their branches over rising customer attacks, according to findings by The Punch. This came a day after the Lagos State Police Command issued a warning that some groups were planning to unleash violence in the state due to the naira scarcity.

The media observed that some of the banks had started to allow non-essential employees to work from home. Findings show Zenith Bank had to shut down some branches in Lagos State over the fear of attacks by angry Nigerians due to the ongoing naira scarcity.

What’s the way forward?

The IMF and Supreme Court seek extension, while President Buhari convenes Council of State meeting. The Council of States have ordered the CBN to print more new Naira notes or recirculate old notes. The advice of the international organisations however, was in line with the Supreme Court ruling against the Friday deadline. The IMF and the World Bank stated that the short timeframe for the currency was causing hardships in the country.

Nigerians are anxiously awaiting the next step of the CBN, especially with the deadline ending on Friday, February 10, just as President Buhari had earlier asked for one week to take a major decision on the matter one way or the other.

In the final analysis, “What it takes to do a job will not be learned from management courses. It is principally a matter of experience, the proper attitude, and common sense — none of which can be taught in a classroom… Human experience shows that people, not organizations or management systems, get things done.” Thank you.

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