With only a few days left before the old Nigerian naira notes are withdrawn from circulation, some banks have accused the Central Bank of Nigeria of not distributing enough new notes. Despite growing pressure to extend the return period for old banknotes, the central bank insists the January 31 deadline still stands.
Less than 40% of ATMs dispense new banknotes
As the January 31 deadline set by the Central Bank of Nigeria (CBN) for the return of old naira banknotes approaches, banks in several Nigerian states are continuing to distribute the notes which will soon be demonetized, according to a report. In addition, fewer automatic teller machines (ATMs) – less than 40% according to a Guardian survey – would have dispensed new banknotes.
According to Tutor’s report, some bank insiders are adamant that the shortages are caused by the CBN, which did not distribute enough new banknotes. An unnamed banker in Lagos claimed that his branch had received “only 1.5 million new banknotes” in the previous week and had no new redrawn naira stock at the time of writing.
The banker, however, suggested that the CBN is planning to carry out a massive rollout of the new banknotes in the last week of January. The banker says:
The deadline is fast approaching, but we are not getting the expected quantity. We suspect they will roll it out massively next week as there is no indication that the deadline will be extended.
Another banker from Nigeria’s Ogun state said that although the CBN has refused to extend the current deadline, the heightened anxiety suggests that a “massive rollout of the money” should have already been done.
CBN refuses to bow to pressure
Fears that many Nigerians will lose out when old naira banknotes are phased out have prompted some politicians to call for an extension of the deadline. However, the CBN has so far refused to bow to pressure and insisted the deadline still stands.
In the past, the central bank has dismissed claims that the move to demonetize old notes was aimed at punishing certain groups. Instead, the CBN insists that the exercise is designed to help it reduce cash management expenses as well as eliminate counterfeit notes.
Meanwhile, some Nigerian commentators have suggested that the CBN may deliberately inject unsuitable banknotes as part of an attempt to force residents to switch to digital alternatives, including its central bank digital currency (CBDC). . Such speculation in turn prompted the Nigeria Governors’ Forum (NGF) to issue a statement warning the CBN.
In the statement, the governors would have said that while not against the currency overhaul policy, the central bank should “take into account the particularities of states, particularly with regard to financial inclusion and underserved locations.”
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