CBN to redesign N200, N500, N1,000 new notes, takes effect December 15

THE Central Bank of Nigeria (CBN) has announced its move to redesign the N200, N500 and N1,000 notes. 

The CBN Governor, Godwin Emefiele, disclosing this on Wednesday at a special press briefing in Abuja, said use of the new notes would become effective from December 15, 2022.

Nigeria currency notes to be redesigned

Emefiele, while advising Nigerians to take old notes to banks for the new ones, said that the action was being taken to take control of the currency in circulation.

According to him, the bulk of the nation’s currency notes was outside bank vaults and the CBN would not allow the situation to continue.

“To be more specific, as at the end of September 2022, available data at the CBN indicated that N2.7 trillion out of the N3.3 trillion currency in circulation was outside the vault of commercial banks across the country and supposedly held by members of the public.

“Evidently, currency in circulation has more than doubled since 2015, rising from N1.46 trillion in December 2015 to N3.2 trillion as at September 2022. I must say that this is a worrisome trend that must not be allowed to continue,” he said.

Emefiele told journalists that the new notes would be released to banks on first-to-come order.

He urged banks to keep their currency processing centres open till Saturday to allow return of old cash to bank vaults.

The CBN chief also directed banks to suspend charges on bank deposits and other payments into their bank accounts.

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Analysts believed the new currency development would create some inconveniences to the people, but would ultimately control currency in circulation that is not in the CBN vault.

The ICIR findings from CBN data sources showed that 80 per cent of currency in circulation is outside the bank vaults, prompting concerns of illicit financial flows and stockpiling of currency for the forthcoming elections.

Analysts said the new move may, therefore, be an approach by the CBN to enable proper monitoring of naira in circulation.

“Do you know how many billions of naira are sitting with kidnappers? The CBN should do this more often to force out all the cash everywhere,” said Tope Fasua, a financial analyst and economist.



    Tope Fasua, a financial analyst

    A financial expert and banking analyst, Joshua Adebisi, who spoke on the development, saw the policy directive as a measure to deepen financial inclusion.

    Adebisi said, “The amount of cash in circulation is a bit of concern, so reducing the amount in circulation will reduce demand of cash. This will also bring in people who are not captured in the traditional banking system.”

    He stressed that if the new notes are limited in supply, it could curb election spending, which would force political parties to be creative in their spending patterns.

    Olajide Alake, an economist

    Another financial expert, Olajide Alake, said, “The move can be perceived from two angles. One, an extreme policy like this in terms of money is mostly designed to demonetise illegal notes that are affecting the economy’s monetary policies, and, two, to render illegal stockpile worthless.

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    Harrison Edeh is a journalist with the International Centre for Investigative Reporting, always determined to drive advocacy for good governance through holding public officials and businesses accountable.

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