Banks discontinue payment of old naira notes across the counter

Nigeria’s deposit money banks (DMBs) have been directed to discontinue the payment of old N1,000, N500, and N200 notes across the counter.

With this directive effective today Monday, January 30, both the new and old N1000, N500 and N200 are not to be paid across the counter, according to sources close the directive at the Bankers Committee meeting.

With this development, bank customers are encouraged to use their alternative channels for their transactions, but those who insist on cash withdrawal across the counter will be paid with lower notes like N100, N50, N20, N10, and N5 while bank customers who insist on the new naira notes are to use the Automated Teller Machines (ATMs).

The Central Bank of Nigeria (CBN) on Sunday extended the deadline for the exchange of old naira notes by 10 days to February 10. The apex bank noted this in a press statement personally signed by its governor, Godwin Emefiele. The CBN wants the remaining N900billion outside banks deposited before the new deadline of February 10.

Emefiele noted that CBN staff currently on mass mobilisation and monitoring together with officials of the EFCC and ICPC will work together to achieve the objectives of the naira redesign which include making Nigeria’s Monetary Policy (MPC) decisions more effective and supporting the efforts of Nigeria’s security agencies in combating banditry and ransom taking.

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To avoid regulatory hammers, many banks have directed their core and non-core operations staff to ensure they don’t have situations of cash shortages in their Automated Teller Machines only to be found that they have the new naira notes in their vaults.

“We deployed all our staff, particularly the Assistant Directors, Deputy Directors and Directors in Abuja to proceed to all CBN branches Nationwide to join the mass mobilisation campaign and monitoring programs, working with the Deposit Money Banks, agents and our Branch controllers across the 36 states of the Federation.

“This is meant to ensure compliance with all our guidelines already issued for smooth implementation of the program. Although we have received some reports of breaches by some bank branches, we have agreed with Executive Chairmen of the EFCC and ICPC to assist us, by sending their staff to all CBN and DMB branches nationwide to join in monitoring the implementation of these guidelines. The aim is to ensure compliance with the laid down guidelines”, CBN governor said in the statement.

“We are happy that so far, the exercise has achieved a success rate of over 75 percent of the N2.7 trillion held outside the banking system. Nigerians in the rural areas, villages, the aged and vulnerable have had the opportunity to swap their old notes; leveraging the Agent Naira Swap initiative as well as the CBN Senior staff nationwide sensitization team exercise,” Emefiele said.

According to him, available data at the Central Bank of Nigeria show that in 2015, Currency -in-Circulation was only NI.4 trillion. As at October 2022, currency in circulation had risen to N3.23 trillion; out of which only N500 billion was within the Banking Industry and N2.7 trillion held permanently in people’s homes.

CBN governor in the statement said the exercise has achieved a success rate of over 75 percent of the N2.7 trillion held outside the banking system. “So far and since the commencement of this programme, we have collected about N1.9 trillion; leaving us with about N900billion (N500billion plus NI.9trilIion).