Saturday , December 3 2022
Naira Redesign: CBN Recover N165 Billion Old Notes

Naira Redesign: CBN Recovers N165 Billion Old Naira Notes

The Central Bank of Nigeria (CBN) says it has received a total of N165 billion so far out of a total of N2.7 trillion currently outside the banking system, since it announced plans to introduce new naira notes and asked Nigerians to deposit all their old notes.

This was made known by the CBN’s director of currency, Rasheed Adams, at a post-press briefing of the Monetary Policy Committee (MPC) meeting on Wednesday in Abuja.

The revelation came as President Muhammadu Buhari unveiled new naira notes ahead of yesterday’s Federal Executive Council meeting in Abuja.

He expressed concern that, in spite of some waivers by the CBN on deposits, only a few Nigerians have come forward; stressing that there will be no extension on the January 23, 2023 deadline.

Recall on October 26, the CBN governor, Godwin Emefiele, while announcing the planned redesign of the high denomination naira notes by December 15, 2022, said the initiative will aid security agencies in tackling illicit financial flow, among others.

Emefiele said there was significant hoarding of naira notes by members of the public, with statistics showing that over 80% of the currency in circulation was outside the vaults of the commercial banks.

Speaking at the post MPC briefing, Adams said, “As at Friday last week, 18th of November, we have a total deposit that we have received from the banks in the sum of N165bn, which is still small.

“We are not seeing the rush. In fact, some of the banks have not even made any deposits within the period and some of these banks have a large customer base.

“So, it is a problem for us and we are hoping that it will not result in a stampede when we are getting close to the deadline.”

He explained that the apex bank has made a lot of concessions to the commercial banks by extending its opening periods to Saturdays, and has waived charges on those deposits and removed all limits in terms of KYC.

“We are still far from where we want to be. We have three scenarios; we have the optimistic scenario where we are hoping that 80 per cent of the N2.7 trillion will come back. We have the pessimistic scenario, where we are looking at 40 per cent. But in the realistic scenario, we feel we will have 60 per cent,” he added.

Adams further hinted that, as of October 26, there was a baseline report prepared on all the account balances in the system. “So if you have a balance of say 10 million on October 26th and now you have a billion, then you may have to explain to some people why or what you do to have that volume.

“So, there is no cause for alarm. If it is your money, bring it.

Adams said: “This exercise is not an exchange programme. It is not like you bring N10 million and we give you N10 million. What we are saying is to put your money in your account and use all the available channels including eNaira to do your transaction.”

He also said “currently we have 88 per cent of the total money in circulation, approximately N2.9 trillion (both inside and outside the bank) constituted by two denominations of N500 and N1,000.”

According to the director of currency, “Even from the deposit, we have received now, 95 per cent is in those denominations.”

“Out of N165bn naira notes, N1,000 constitutes N86bn, N500 is about N51bn and if you come down to N200, it is just N7bn which translates to 4 per cent.

“Going forward, the N1,000 and N500 will not be easily available for hoarding. We want to drive a cashless policy and we want to reduce the cost of currency management because you have to carry these sums across the 36 states.”

About Bukola Olanrewaju

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