Retaining old naira notes will encourage vote-buying – CBN

The Central Bank of Nigeria (CBN), has pinned its reluctance to extend the expiry date for the old naira notes on the need to save Nigeria’s democracy from vote-buying in the coming presidential election.

The apex bank gave the reason, among others, in a counter-affidavit to a suit filed against it by a group, Social Rehabilitation Grace and Supportive Initiative (SRG) led by a Nigeria-born United States medical practitioner, Marindoti Oludare.

The SRG, code-named Social Rehabilitation Gruppe, was launched in Akure, the Ondo State capital.

Reacting to the group’s suit before a Federal High Court sitting in Akure, in which it asked the court to compel the CBN to extend the expiry date for the old naira notes by six months, the apex bank urged the court to dismiss the suit, averring that the plaintiffs had no justifiable reason for filing it.

In a counter-affidavit through its counsel, O. M. Atoyebi and co., the CBN opposed the defendants’ interlocutory injunction on the grounds that “the extension (of the expiry date for old naira notes of N200, N500 and N1000) will give room for vote-buying and undermine the forthcoming election”.

It also added that “the extension of the timeliness will jeopardise the fight against fraud, corruption and criminal activities perpetrated with the use of the old currencies”. It specifically cited the festering kidnapping crime, claiming a change in currency notes will end it.

Countering the SRG’s reference to currency change in India in 2016 in which the group said the Indians were given enough time to replace old Indian rupees, the CBN differed in its narration of the Indian experience.

“The government of India announced the change of their legal tender on November 8, 2016, and was implemented within two days,” CBN’s counsel said.

“The entire citizens of India of about 1.417 billion adhered to the timeliness strictly, which has led to positive improvement of the Indian economy.”

Read also: Naira notes swap: How do we get out of the quagmire?

But in its suit, the SRG argued that the CBN acted beyond its powers by setting a timeliness for the expiration of the old Naira notes.

“While we know of a fact that the CBN has the right to denominate the Naira, it has no right to erase the value acquired by individuals,” the group stressed.

It also remarked that “the administration of former President Goodluck Jonathan also redesigned currency notes, following which the new and old naira notes were both legal tender for over two years before the old notes went out of circulation”.

Oludare, the first plaintiff, also stated, “When I visited Nigeria from the United States of America on December 29, 2022, I went to Automated Teller Machine operated by First Bank of Nigeria Plc in Lagos to make some cash withdrawals but the machine dispensed only the old notes”.

He said the CBN had failed to also provide a means whereby Nigerians resident abroad could exchange their old notes.

In the suit therefore, the four plaintiffs, namely Oludare, the SRG, Omoyele Ishola and Demola Obadofin, are asking the court to extend February 10, 2023, for the expiration of the old naira notes by six months.