Amid concerns about the scarcity of new Naira notes, the Central Bank of Nigeria (CBN) has insisted that January 31 is the expiration date for the old banknotes.Paul Ogubuokiri reports palpable fear that the new notes will be invisible and that banks appear unwilling to release them to the public
14 days until deadline, no new notes available
With 14 days left until the deadline set by the Central Bank of Nigeria (CBN) for the current naira notes to cease to be legal tender, new naira notes have yet to be issued, making it difficult for the top bank to meet its January 31 target. I doubt. Circulating. It’s no different than a commercial bank yet to follow the central bank’s instructions to start loading the redesigned currency into his ATM machines.
In response to this development, Muda Yusuf, a Nigerian economist and chief executive of the Center for the Promotion of Private Enterprises (CPPE), said that the CBN has significantly reduced what is needed to make the currency available across the country. He said it was underestimated.
Yusuf said Monday when he appeared on Arise TV’s morning show.
He said the January 31 deadline set by Apex Bank was unrealistic.
he said: Clearly, there is plenty of evidence all around us that we can see. We are working on capacity issues on the CBN side, capacity on the production of new notebooks, and capacity issues on logistics.
“Clearly, CBN has vastly underestimated what it takes to make these currencies available nationwide. If so, what would you say about people in more remote areas of other states outside of these major cities?”
However, Apex Bank said it will monitor commercial banks to ensure compliance with the mandate to load the redesigned naira notes into automated teller machines (ATMs).
CBN Director Monetary Affairs Ahmed Umar made this clear during a training session for national directors of the National Orientation Agency (NOA) on redesigning banknote policies in Abuja on Monday.
Umar said the CBN’s directive is to implement the withdrawal of the January 31 deadline for old naira notes in circulation.
“We at CBN have ordered banks to stop putting old banknotes into ATM machines. They should only put new notes.
“And we have a set of policies that allow us to issue N500, N1000 or N200 banknotes regardless of the denomination or combination of these banknotes we hold, and we have to put new banknotes into the machine.
“We will monitor banks to ensure they are compliant, and if they are not compliant, we will impose penalties for violations,” the director said.
Remember, Central Bank Governor Godwin Emephile urged Nigerians to deposit their current naira notes into new naira notes by the deadline, saying that the Jan. 31 deadline was sacred. .
At the 2022 Annual Bankers’ Banquet hosted by the Institute of Nigerian Bankers (CIBN), Emefil said he would revoke the January 31, 2023 deadline given to Nigerians to deposit existing naira notes in banks. said you can’t. Newly redesigned Notes.
Apex Bank has vowed not to change the deadline, despite calls by the Senate to urgently extend it from January 31, 2023 to June 30, 2023.
The newly redesigned Naira banknote entered circulation last Thursday, but financial experts fear there may be an artificial shortage of the new currency.
Our correspondent who went around the ATMs of several banks in Lagos found none of them issuing new banknotes.
This is what Abuja resident taxi driver Adamu Ismail told The Sunday Telegraph, saying most ATMs in Jabi and Wuse checked for the new Naira, but none issued new banknotes. There was not.
Speaking on the development on Thursday, Idakolo Gbolade, a financial inclusion/wealth management expert, said the CBN is unlikely to provide banks with enough of the new currency.
He urged the central bank to take steps to ensure proper circulation of the new Naira banknotes to Nigerians.
he said: Also note that CBN is unlikely to provide enough new currencies for deposit money banks and microfinance banks. As a result, cash deposited into ATMs may not be able to meet demand. “
CBN may need to “take steps to ensure sufficient circulation of new banknotes to avoid persistent shortages,” he said.
Similarly, Professor Godwin Oyedkun, an accounting and financial development expert at Reid City University in Ibadan, urged Nigerians not to panic about the availability of new Naira banknotes.
He reiterated that artificial scarcity may be imminent as most Nigerians are desperate for new banknotes.
“No matter how perfect the situation, there is always room for improvement. When the Central Bank of Nigeria says new banknotes will be issued today, remember that the supply is not the amount of old Naira banknotes. It will go out, and withdrawal limits may also affect distribution.
“Everyone wants the new Naira banknotes. On the issue of availability, Nigerians should not be sleep deprived of it, there is no need to panic,” he said.
He explained that bank ATMs across the country should also remove old notes and make new naira notes available.
CBN said Deposit Money Banks had received a stock of new naira notes.
Keffi Professor Uche Uwaleke, a professor of finance and capital markets at Nasarawa State University, did not agree with calls for an extension of the withdrawal deadline for old banknotes at the end of the month, but said: CBN needs to address concerns about the availability of new currencies.
Former Imo State Treasurer said: The majority of cash withdrawals from banks and his POS agents are still made in old naira notes.
“Banks appear to be hoarding new naira notes to distribute to their wealthy customers, most of whom are politicians, especially during this festive period.”
“If the 31st January 2023 deadline is to be met, CBN expects to issue more redesigned banknotes and ensure banks distribute them to their customers,” said Uwareke. This has become necessary given the upward revision of the personal cash withdrawal limit from N100,000 to N500,000 per week.
“Otherwise, with the current slow rate and biased way banks are distributing the new naira notes, we foresee a situation where the deadline is extended by at least two weeks.”
But he extended it to June 30, 2023, as explained in several quarters, saying it would defeat one of the purposes of the currency redesign, which was to discourage voting. Buy, considering the fact that the general election would have been over by then, who said he didn’t support the idea.
Dr. Chijioke Ekechukwu, Managing Director and Chief Executive Officer of Dignity Finance and Investment Limited, also commented on the development, stressing the need for CBN to educate and raise the awareness of Nigerians, saying that rural residents should “ They prefer the currency they know, they prefer the currency.” It is better not to sell than to receive new naira.”
According to the former secretary general of the Abuja Chamber of Commerce and Industry (ACCI), “CBN needs to raise awareness. Many market women and rural residents still reject the new currency. They prefer currencies they know and prefer to sell rather than receive new Naira. Therefore, in rural communities they may encounter shortages of new currency and may not be aware of deadlines. .
“In order for everyone to have access at the right time, there should be more circulation. At the moment, all ATMs should issue new notes, and banks should only pay new notes. It’s a way to reach the desired milestones.”
Idakolo Gbolade, Managing Director/Chief Executive of SD&D Capital Management Limited, said the expiry date of the old banknotes could cause Nigerians to fight for the new banknotes. Lack of adequate education and awareness has led to market traders and rural residents.
Gbolade said: With the expiration of the old banknotes at the end of January 2023, Nigerians will be fighting for the new banknotes.
“The main implication is that when the old fiat currency becomes invalid, it devalues those who hold the old banknotes, which can lead to protests by the already impoverished public, so to speak. of losing what little you have.”
he said: So losing such a large amount of cash due to the deadline for changing to new banknotes could portend great danger to the economy. “
Emefille’s vision narrows
Central Bank Governor Godwin Emephile accompanied President Buhari on a foreign trip to the United States. It is believed that his overseas stay may not be unrelated to arrest and investigation threats from the Department of State (DSS) at a time when the president’s office appears reluctant to step into the matter.
Emefiele left for the United States on December 26 and remained there until the time of filing this report. Some reports said he returned home within a week of him.
The central bank governor announced the central bank’s determination to redesign, produce and distribute a new series of N200, N500 and N1,000 denominations on October 26, 2022.
Emefile said the move would help control the money supply, counterfeit currency and combat terrorism, among other things.
He stated that the new banknotes will go into circulation on December 15, 2022, but that the new and existing currencies will remain legal tender until January 31, 2023, when the existing currency ceases to be legal tender. He explained that they would run together.
CBN imposes sanctions on banks failing to issue new naira notes
From now on, all commercial banks in Nigeria will be sanctioned by the central bank for not loading newly designed naira notes into their automated teller machines (ATMs).
In the last quarter of last year, Apex Bank announced design and color changes for its N200, N500, and N1000 denominations and fixed daily cash withdrawals at the counter.
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