The newly redesigned naira notes will go into circulation on Thursday (today) with Deposit Money Banks releasing the bills to their customers via over-the-counter payments.
This came about three weeks after the President, Major General Muhammadu Buhari (retd), unveiled the new bills at a weekly Federal Executive Council meeting in Aso Rock Villa.
The President unveiled the redesigned notes across the N200, N500 and N1,000 denominations.
The Governor, Central Bank of Nigeria, Godwin Emefiele, had in October announced that apex bank would release re-designed naira notes by December 15, 2022.
He also disclosed that the old notes would cease to be regarded as legal tender by January 31, 2023.
Emefiele pointed out that the redesigning of the naira notes would help to curb counterfeit notes, and reduce ransom payments to terrorists and kidnappers.
The CBN boss said it was worrisome that 85 per cent of the total currency in circulation was being hoarded by Nigerians.
As such, he said the redesigning of the local currency would help to mop up the currency outside the banking sector, adding that out of about N3.3tn in circulation, close to N2.75tn were outside the banking sector.
Meanwhile, top officials of commercial banks confirmed to our correspondent on Wednesday they had received the new notes from the CBN a couple of days ago, adding that the redesigned currency would be released to their customers effective Thursday (today).
“We got the funds (new notes) about two days ago. Our head office has dispatched the funds to various area offices across the country. My branch will pick up our allocation at a nearby area office. We will start releasing the new notes to our customers by Thursday,” according to a top official of a commercial bank who spoke to one of our correspondents on condition of anonymity on Wednesday because he was not authorised to speak on the matter.
Multiple banking sources also said the new notes had arrived and were being kept in their vaults.
They confirmed the new notes would be paid to customers in banking halls beginning from Thursday.
“The new notes have arrived, it will be made available to customers from tomorrow (Thursday)” an official of Polaris Bank who pleaded anonymity told The PUNCH.
Also, a manager at First Bank Plc who was not authorised to speak on the matter said, “We have the funds from the CBN now. It came in some days ago but it will be made available to customers from tomorrow (Thursday).”
However, some bank officials claimed the amount of the new notes available to the various bank from the CBN was small.
According to them, most OTC payments will still have to be made using the old notes because the amount of the available new notes is still small.
“The amount given to us is small compared to what we need. For example, what is available to my branch is less than N1m. This is nothing compared to what we need. But I believe it will increase with time,” an official of FCMB in Lagos who pleaded anonymity told one of our correspondents.
Also, multiple banking sources confirmed they have started to reconfigure their ATMs to identify the new naira notes.
A top bank executive said, “Most of the banks have started reconfiguring their ATMs so that they can identify the new notes of N1000, N500 and N200.,”’
Meanwhile, findings from the CBN show the total amount to be released into circulation may not be much as the sum previously in circulation.
A top official of the CBN, who spoke on condition of anonymity, said the CBN was planning to increase electronic payments and not cash transactions.
According to him, the CBN will not be printing large amount of the new notes.
He said, “The CBN has been disbursing the new naira notes to the banks but does not intend to disburse large quantities because it wants to boost electronic payments.
“Don’t expect that there will be a large circulation of the new notes in the economy. There are different electronic channels that people should be using.”
Reps expect Emefiele
Barring any last-minute change of plans, the House of Representatives will on Thursday (today) grill Emefiele over the new cash withdrawal limits policy which restricts OTC payments for individuals and companies to N100,000 and N500,000, respectively.
The CBN had, in a memo introducing the policy, said third-party cheques above N50,000 would no longer be eligible for OTC payment while extant limits of N10m on clearing cheques still remained.
The circular also directed banks to load only N200 and lower denominations into their ATMs and restricted withdrawals from ATM to N20, 000 per day. Withdrawals from PoS terminals were also limited to N20,000 daily.
The policy, which will become effective on January 9, 2023, has generated criticisms but the CBN clarified last Wednesday that PoS operators could apply for a waiver.
The House had last Thursday summoned the CBN governor to appear before it to explain the policy.
House of Reps sources told one of our correspondents on Wednesday that Emefiele was being expected in the chamber as planned.
Senate backs CBN
Meanwhile, the Senate on Wednesday called on the CBN to review the newly introduced cash withdrawal limits policy.
It also directed its Committee on Banking, Insurance and other Financial Institutions, to embark on an aggressive oversight of the central bank.
The Chairman of the committee, Senator Uba Sani (APC Kaduna Central), had in the report argued that the proposed cash withdrawal limits policy was well conceived by the CBN for the transformation of the nation’s economy, noting that the action falls within the mandate of the apex bank as provided for in Section 2(d) and 47 of its extant Act .
However, during the general debate on the report, many of the senators kicked against the timing of the policy stating that it could be particularly counter-productive.
The first to revolt was Senator Ajibola Basiru (APC Osun Central), who said the proposed threshold of N100,000 and N500, 000 withdrawals per week for individuals and corporate bodies respectively, was unrealistic.
He said, “Based on the report I got from my constituencies who are basically small traders, rural dwellers and people who may be negatively impacted by the policy, I think it is better to stick to fact, the threshold that has been set is totally unrealistic to have any robust and meaningful life for our people.
“Above N100,000 per week, you pay a processing fee of five per cent, looking at the inflation trend in our country and looking at the average cost of living and survival of every family in Nigeria, N20,000 daily withdrawal is going to terribly affect our people.”
Ajibola, who described the recommendation of the committee as vague, said, “I am not oblivious of the fact that the committee had made recommendations on adjustments, but this is not enough. As a committee of the senate, they ought to have interacted with the indices to come up with recommendations.”
Interrupting Ajibola, the Deputy Senate President, Senator Ovie Omo-Agege, who presided over the plenary, said, “That would mean that the senate was interfering with the independence of the bank in line with Section 2 sub-section (47) that gave the CBN this power.”
Ajibola who still had the floor, in his response said, “If we cannot make suggestions on the threshold, then we have no business talking about this issue. I suggest that we increase the threshold to N100,000 daily and N500,000 weekly. This is realistic; the law is made for man and for the welfare of the people in our society.
“Why can’t we considerably adjust the withdrawal limits, that is vague, nebulous and adds nothing to the agitations of the Nigerian people who have elected us into the office.”
Also, Senator Adamu Aliero (PDP Kebbi Central) said, “This report gives us an ideal picture of what the economy should look like but in reality, it’s not the same. The informal sector of the economy in Nigeria is very big and it’s not captured in the banking system.
“Most people living in rural areas don’t go to the bank, they keep their money under their pillows and there is a need for sensitisation and enlightenment for the programme to fly. We have 774 local governments in this country; I can assure you that the banks barely have branches in 60 per cent of the places.”
He added, “I support the idea of e-banking but we should do it with caution. The CBN should considerably adjust the withdrawal limits in response to the public outcry; people are against this policy. If we give it about two to three years, people will embrace it.”
Again, in defence of the apex bank, Omo-Agege reminded the senate that the policy started 10 years ago but his colleagues chorused, “where?”
Senator Adamu Bulkachuwa (PDP Bauchi North), in his contribution, warned that the proposed policy, if not suspended, might trigger a revolt from rural population