Nigerians have called on the Central Bank of Nigeria (CBN) to review its Naira Redesign Policy.
Recall the CBN, in a letter dated December 6, 2022, had directed all Deposit Money Banks (DMBs) and other financial institutions to comply with its new policies (Naira Redesign and Cash Withdrawal Limit).
However, there have been mixed reactions to the circulation of the new naira notes that President Muhammadu Buhari unveiled on November 23, 2022.
In this report, NIGERIAN TRIBUNE x-rayed the opinions of Nigerians on the newly designed naira notes. Most respondents expressed displeasure over the CBN’s new policy, while others were indifferent.
Our findings
Our reporter visited at least 10 different ATM points within the Ibadan, Lagos, and Abuja metropolis to confirm if the newly designed naira notes are in mass circulation.
Surprisingly, none of the ATM points visited dispensed the new naira notes.
However, an inside source in one of the leading Nigerian banks told our reporter that commercial banks are short of the new naira notes following an order from the CBN.
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“For now, we are being instructed not to give out more than a certain amount of money to customers. The new notes in circulation are not enough. What we have must be evenly distributed to at least 50-60 people at most instead of one person acquiring everything at once.
“They (CBN) just want to see that the banks can manage whatever amount they have among a good number of customers,” the source disclosed.
Nigerians react
A trader in her 60s, identified as Mrs Bolanle Sodiq, said the CBN’s new policy is not tenable, calling for the policy to be reviewed.
“These new notes lack substance. It’s like the government just destroyed the quality of our currency. However, it’s done with good intentions (sanitising the system).
“Our politicians are fond of hoarding money in their houses, hence, inflicting pain on the poor masses but with the introduction of the new naira notes, I think this will reduce.
“For me, there is not much difference between these new notes and the old; it’s just a change of colour. I would like the federal government to help us review the policy,” she said.
Another trader, who identified herself as Mrs Onifade Abosede said she is now careful while transacting business with customers following the purported claims of fake naira notes in circulation.
“I have been treading cautiously since unveiling the new naira notes because of the fake currency in circulation. For instance, when a customer comes to buy goods, it is difficult for me to differentiate between fake N1,000 notes and genuine ones,” she noted.
In her remarks, Miss Rachael, a PoS operator said; “I don’t like these new notes. It’s difficult for me to identify the original from the fake.”
Another PoS operator, Mr Kehinde, on his part, said he trades with both the old and new naira notes based on the preferences of his customers.
“I observed some of my customers objected when I give them the new notes while others happily receive them when I give them. So, I am not challenged when transacting business with my customers.
“I think the government should do more sensitisation on the policy to enable Nigerians, especially those with little or no knowledge about the policy understand it better. This will help to remove the doubt and fears in their minds.”
Business perspective
Emeka Anaeto, a business analyst, in a telephone conversation with our reporter, said the CBN’s policy would enable the apex bank to have more control over money.
“The currency in circulation is over 3.7 trillion. Out of that, the amount in the bank is about 1.3 trillion. The rest are outside the bank. By implication, more monies are outside the banking system.
“When CBN wants to make policy for any monetary issue, it means it is only the monies in the banking system that will be effective while the ones outside the banking system are out of their control. Going by the figures I earlier mentioned, it means less than half of the money in the economy can be controlled,” he said.
On the effectiveness of the newly designed naira notes, Mr Aneto said; “the effectiveness is to increase the influence or impact of CBN’s policy by a situation where more money is in the banking system. Therefore, there will be more impact on CBN’s monetary policy.
“For instance, you know everybody will bring their money into the bank due to this redesigned naira. Theoretically, 100 per cent of the money will come into the bank instead of the less than 40 per cent it is now. In the short run, CBN has 100 per cent control over monies in circulation, meaning that the policy will be more effective.”
On the implication of the cash withdrawal limit policy on the 2023 elections, he said; “there will be a drastic reduction in vote buying during elections. on the corruption side, there is now a glass ceiling in transactions which is now limited to transfer as against the withdrawal method. This means any security agency can easily trace any illegal transaction.”
He added that the policy might likely shut down PoS businesses and render millions of Nigerians jobless if not well managed.
“A lot of businesses are cash-driven. So, those businesses will be adversely affected by the CBN’s policy. For example, it is not always smooth if you want to do a transfer. This will also affect PoS businesses because they operate in cash. They (PoS operators) will be shut down, and about 1.4 million people may lose their livelihood source due to this.”
He, however, recommended that the cash withdrawal limit should be reviewed upward.
It’s a welcome development — Ubani
Barrister Monday Ubani, an Human Rights lawyer, in his submission, lauded the CBN’s new policy for meeting best international practices.
“The policy for me is a best international practice. You will see that the developed nations pump more money into the system, and most things are done through the bank, such as the PoS, bank transfers, etc. You can do up to 20 million or 30 million. The only thing is that you pay some level of cost on that transaction but carrying cash which we have glamorised in this part of the world, is something they (CBN) want to discourage.
“They also want to fight against these politicians carrying so much cash during the election period to bribe the voters. This is one of the ways to actually nip in the bud by now allowing a certain amount of money to be in the hands of any of the citizens. So, it’s a welcome development.”
