Commercial banks are rationing the new naira notes they have received from the Central Bank of Nigeria (CBN) as many customers are keen to hold the redesigned notes, BusinessDay findings show.
The CBN had on October 27, 2022 announced that the higher denominations of the naira – N200, N500 and N1,000 – would be redesigned and introduced into the economy from December 15, 2022 and asked commercial banks to return existing denominations to it.
Our correspondents who visited some bank branches in Lagos and Aba in Abia State on Friday observed that only few banks had the new naira notes. Some Automated Teller Machines dispensed mixtures of old and new notes to customers.
One of the banks visited paid a maximum of N10,000 new notes to customers on request. While some customers were eager to see the new notes, others just wanted the ATMs to dispense money to them.
Read also: Quick facts about the new naira notes you should know
At a bank, customers who wanted the new naira notes were asked to withdraw over the counter as there was none in the ATMs.
Jude Monye, executive director at Heritage Bank, said the rationing of the new naira notes is normal because the old notes are still in circulation.
He said the CBN is pumping the redesigned note into the banks and that from Friday to January 31, 2022, there would be a parallel run of the banknotes.
Some banks in Aba told our correspondent that there were still awaiting the supply of the new notes from the CBN.
Godwin Emefiele, governor of the CBN, has said the ever-escalating challenges inundating currency management in Nigeria, with grim consequences for the country’s sovereign integrity, prompted the CBN to issue newly redesigned banknotes.
“Analysis of the key challenges primarily indicated a significant hoarding of banknotes, as over 85 percent of currency in circulation were held outside the banking system. This is even as currency in circulation more than doubled from N1.46 trillion in December 2015 to N3.23 trillion in September 2022; a worrisome trend that must be curbed,” he said.
According to him, while the global best practice is to undertake currency redesign every 5–8 years, Nigeria’s existing banknotes have remained unchanged for almost 20 years.
He said the naira redesign policy will quicken the attainment of a cashless economy as it is complemented by increased minting of eNaira. He said it would curtail currency outside the banking system and, as monetary policy becomes more efficacious, help to rein in inflation.
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