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HOME / Editorial
Naira Scarcity: Respite As CBN Succumbs To Pressure
Published Mar 16, 2023 IN Editorial,
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AFTER over two months of excruciating pains and difficulties accessing the redesigned naira notes, respite seems to have come the way of bank customers across the country as the Central Bank of Nigeria (CBN) has finally given a directive to commercial banks to begin disbursement of the old naira notes, thereby revalidating it as legal tender.

This followed weeks of foot-dragging and attendant confusion over the legality of the process leading to banning of old N200, N500 and N1, 000 notes by the CBN and the Federal Government and the subsequent annulment by the Supreme Court following its historic judgment of March 3, 2023.

Recall that the Federal Government, through the CBN, in October 2022, announced the introduction of redesigned N200, N500 and N1, 000 notes into the country’s financial system. But since the notes were unveiled, Nigerians from various parts of the country and across different business ventures have been struggling to access it from commercial banks and ATM cash points.

According to the CBN Governor, Mr. Godwin Emefiele, the main objectives of the cashless policy and currency redesign were to make monetary policy decisions more effective, deepen financial inclusion in the country, curb terror financing and banditry and discourage vote-buying by politicians and money laundering, among others, adding that politicians were stocking money for election activities.

Specifically, the naira redesign policy was also intended to curb the inflation in the market as less cash holding reduces currency outside banks and, to a large extent, reduces money in circulation, as the accompanying decline in the money supply would slow the pace of inflation.

In a nation where there appears to be a penchant for large scale misappropriation and looting of public funds, the cashless policy is, no doubt, a welcome relief. But the policy was hellish given the nightmare most people experienced due to poor implementation of the policy by bank officials and other critical players in the financial sector.

To say that Nigerians are going through a lot within this period is indeed stating the obvious, given the fact that the well-intended monetary policy of the CBN may have experienced some level of sabotage, or, perhaps, poorly implemented as the supposed benefits seems to have been defeated in the course of the policy implementation that has become a matter of public discourse across the country.

What could be worse and more irritating than the confusion thrown up from the confusing directives from the opposing quarters- President Muhamadu Buhari on one side while the Supreme Court seems to be on the side of the people, was giving counter directive to the hapless and cash strapped Nigerians amid the controversies created by the outcome of February 25, 2023 Presidential and National Assembly elections .

While there appears to be respite in the horizon following the Presidential directive in the national broadcast, revalidating the use of N200 old notes until April 10, the long queue in the bank halls then and the attendant suffering by Nigerians to access the currency, who in the process lost valuable manhour that could have been used for other worthy ventures, was insidious and unacceptable.

From the poor farmers in the rural communities to the traders in the neighourhood and further to transporters, they all had one terrible story to tell as the issue of new naira notes at a time became an albatross with no escape route to safety.

Remarkable as the CBN’s monetary intervention policy initiated to curb some noticeable anomalies in the nation’s economy appears to be, the CBN should operate it with a human face and clear understanding of the peculiarity of the configuration of the nation’s financial system, while at the same time upgrade the internet facilities of the banks to meet the emerging challenge in the face of the current reality.

Now that the dust seems to be settling, as the CBN may have apparently bowed to pressure, we, however, advise that CBN in liaison with commercial banks should adopt a strategic mechanism to attend to the bank customers in need of cash for their commercial transactions and ensure the stability of economy while allowing both the old and redesigned Naira notes to exist side by side until December 31, 2023 deadline.

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