January deadline: Discordant tunes over CBN’s new naira notes
On the very last day of this month, January 31, 2023, old naira notes of N200, N500 and N1,000 shall cease to be legal tenders in Nigeria. The Central Bank of Nigeria (CBN) has warned that there will be no extension of the deadline for the use of the old notes.
Following up on this, the CBN commenced an aggressive nationwide sensitization to update the people on the need to pay in all old notes into their bank accounts to help them beat the deadline.
Meanwhile, the CBN has said that old notes which are not paid into the banks before January 31, 2023, will become invalid. It said that the bank has taken steps to ensure that everyone is able to meet the deadline, by ensuring that firstly, no charges are imposed on customers who want to pay any amount of money into the bank, and that banks will open even on Saturdays to ensure that no one missed the opportunity of paying their old notes into the bank.
Last week, officials of CBN took time to move round many markets in Anambra State to sensitise the people both on the deadline, the security features of the notes, the quality and the dangers of not accepting the notes as legal tenders.
Early in January, there have been incidents of people rejecting the notes, maybe as a result of the ignorance of the changes, while some said the rejection was about the inferior nature of the notes, which they said was susceptible to being counterfeited.
Some traders who had spoken to DAILY POST during an independent interview, including an Awka based commercial driver, Mr Edward Ezediuno said: “All the new notes look fake already, so we are afraid that if they give us the fake ones, we will not be able to differentiate it with the authentic ones.”
There were incidents of many consumers having problems with traders, but the recent sensitization tour of markets in Anambra, and the complaints received, showed that the issue is no longer about the authenticity of the notes, but the availability. This may be because the CBN had insisted that there will be no grace period after January 31, and that Nigerians have no option other than accepting the new notes.
During the CBN sensitization exercise, which happened in major markets in Awka, Nnewi and Onitsha, DAILY POST monitored reactions of traders who were being sensitised about the new notes. Though a few traders still complained about the inferiority of the notes, the major complaints were about the availability and the high cost of getting the notes from black market retailers.
During a visit to the Onitsha Main Market, which is reputed to be the largest market in the entire West Africa, many traders who spoke to our correspondent complained of availability and quality of the notes. Mr Igwemba Uzor, a trader in the market removed a white handkerchief from his pocket to show the stains made on it by the N1,000 note.
“This white handkerchief was stained by the new naira notes. See the ink. One of my friends just asked that we try it, and this is the result. From what this note did to this handkerchief, I am sensing that if you wear white dress and you have the money on you, if rain beats you, or you sweat very well, the money can stain your clothes.”
In Nkwo Nnewi Spare Parts Market, traders sang a different tune. They welcomed the money, but protested that the notes are virtually unavailable in banks, and that they have made efforts to take their old notes to the bank, hoping that when they withdraw, they will get the new notes, but that has not always been the case.
A trader in the market, Pastor Frank Ejimbe accused CBN officials of playing politics with the new notes.
He said: “You people are doing business with the new naira notes. How can black market people have the new notes to the point that any amount you want, they can sell to you, but banks don’t have it. Does that make sense?”
Two traders, Mr. Nwabueze Igwe and Mr. Sylvester Ekweonu in the same market, expressed worry that commercial banks and Point of Sell Operators were still issuing the old naira notes to customers.
Nwabueze said: “We want CBN to be sincere about the introduction of the new notes. We need to know why each time we take old notes to the banks, it is usually the old notes that they use to pay us, when we come to withdraw.”
For two other traders, Mrs. Nkechi Ogbu and Mr. Solomon Ejike, the deadline was too short to mop up all the old notes in circulation across the country and appealed for the extension of the period.
“When we were young, the usual practice is that when there is a new currency, all the banks do is that once they get your old currency, you will never be able to get it again, because they pay the new currency. But today, banks receive the old currency as deposit and also pay out the old ones. How will they now mop up the old currency,” Mrs Ogbu lamented.
Meanwhile, Officials of the bank, including the CBN branch controller, Awka, CBN’s Director, Other Financial Institutions Department, Mrs Nkiru Asiegbu, and many others, who spoke to the traders during the sensitization exercise, harped on the deadline for the use of the old currency.
The officials visited several markets in the State, including: Agbo-Edo Market in Nnewi, Main Market, Onitsha, Tools and Allied Materials Market, Bridge Head, Onitsha, Odera Market in Awka and Building Materials Market in Nkpor.
Speaking at Tools and Allied Material Market, Bridge head Onitsha, Mrs Asiegbu said: “You must also strive to deposit all old notes of N200, N500, N1,000 before the last day of this month. We have met with heads of all commercial banks and directed that they begin the distribution of the new naira notes without further delay.”
As of the time of filing this report, the traders are still sceptical about meeting the deadline since they also draw old notes each time they make deposits.
Mr Tony Eze, a trader at Odera Market said: “They want us to pay our money into banks and wait for when new notes will be dispensed, not knowing that many people survive by making sales and taking the money to the market to purchase more goods. How can they now pay into the banks and leave their money there, waiting for when new notes will be available?”
However, the bank officials also explained that soon, banks who fail to pay customers with the new naira notes will be sanctioned, adding that there has been strict monitoring, to ensure that banks dispense the new notes through their Automated Teller Machines.
It was, however, gathered that the shortage of the new notes is deliberate, and meant as a policy that will curb the rising inflation in Nigeria, as the mopped up funds will never be released to the public again, while the new notes will also be scarce, and this will give the naira some prestige.
“If the naira becomes scarce, what it means is that less money will be chasing many goods, as against now that too much money is chasing less goods, because of the high volume of money in circulation,” a source said.