Wealthy individuals and organizations with huge cash stashed away have begun depositing them in banks.
This is coming days after the Central Bank of Nigeria announced the redesign of the N1,000, N500 and N200 notes, with a directive that the current notes be remitted to the commercial banks.
It was gathered from sources and workers in the operations department of many commercial banks that even though there has yet to be any rush by customers, there was a gradual increase in the volume of cash and amounts being remitted by customers.
The Governor of the CBN, Mr Godwin Emefiele, while announcing the issuance of the new naira notes on October 26, said bank customers should start paying their current notes to enable them to withdraw the new bank notes once circulation begins on December 15, 2022.
Emefiele said the apex bank had become concerned over some daunting challenges in the management of the existing banknotes in circulation, especially those outside the banking system, noting that such portend some consequences for the integrity of the CBN and the country.
Among the challenges that informed the decision, he lamented the “significant hoarding” of the banknotes in which case N2.73tn out of the N3.23tn currency in circulation as of September 2022 was outside the vaults of the commercial banks across the country. He also cited the worsening shortage of clean and fit banknotes; increasing ease and risk of counterfeiting evidenced by several security reports and compliance with global standard to circulate new legal tender every five to eight years.
He noted further that the naira redesign would help to rein in the currency outside the banking system and make its monetary policies more efficacious, deepen its cashless economy drive and minimise incidents of terrorism and kidnapping as the access to large sums used for ransom payment.
He noted, “On the basis of these trends, problems, and facts set out above, and in line with provisions of Sections 2(b), section 18(a) , and section 19, Subsections a and b of the CBN Act 2007, the Management of the CBN has sought and obtained the approval of President Muhammadu Buhari to redesign, produce, release and circulate new series of banknotes at N200, N500, and N1,000 levels.
“In line with this approval, we have finalised arrangements for the new currency to begin circulation from December 15, 2022 after its launch by President Muhammadu Buhari. The new and existing currencies shall remain legal tender and circulate together until January 31, 2023 when the existing currencies shall cease to be legal tender.”
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