New Currency: Emefiele Defies NASS, Says no Shift in January 31 Deadline

The Central Bank of Nigeria (CBN) governor, Mr. Godwin Emefiele, has said there will be no shift in the January 31 2023 deadline for the expiration of old N200, N500 and N1000 notes.

Emefiele who spoke at the end of a the two-day Monetary Policy Committee (MPC) meeting insisted that on January 31, 2023, the old notes would no longer be accepted as legal tender anywhere in Nigeria.

Economic Confidential reports that the MPC resolution is coming on the heels of another resolution by the two chambers of the National Assembly calling on the apex bank to shift the deadline till July, 2023.

The lawmakers who spoke at both the Senate and House of Representatives plenaries on Tuesday argued that the new naira notes have not circulated wide enough for the old notes to be banned completely.

The lawmakers argued further that the time given by the CBN to phase out the old notes and for Nigerians to access the new notes is too short.

Addressing journalists at the end of the MPC meeting, Emefiele however said: “For those hoping on extension, I will say that unfortunately, I don’t have good news for you. For those who feel that we should shift the deadline, my apologies. The reason is just like the President said, 100 days is enough for anybody who has money or the old currency to deposit the money in the banks. We took every measure to ensure that all the banks were open to receive old currencies. 100 days we believe is more than adequate. We called on banks, we said we are only requesting you to extend your banking hours, we asked them to keep their doors open on Saturdays. We do not see any reason to begin to talk about a shift because people could not deposit their own monies into their banks.”

Emefiele said when CBN discovered lending banks were given priority attention to their prime customers in supply of new notes over the counter, he directed the banks to begin loading of new notes into ATMs. He said ATM was a robot everybody can use.

Asked what was the level of currency outside of banks’ vault, Emefiele said, the bank had taken in close to N2 trillion and expressed optimism it will be better after a week.

Emefiele explained that for instance, currency in circulation grew in seven years from N1.4 trillion to N3.23 trillion between 2015 and 2022.

He said the apex bank believes that there is no reason why currency in circulation would have grown this much if it is not being kept outside the banking system.

“In 2022 currency in circulation had grown to N3.23 trillion more than double as about N1.7 trillion was left in the vaults of bank by the end of the year. This has made the efficacy of monetary policy so difficult because what you would have expected is that when currency is issued, it will circulate. After some time, the old notes and those which had worn out would be returned to CBN.”

“So, there is no reason why currency in circulation will grow from N1.4 trillion to N3.23 trillion in seven years. People are hoarding it. People are keeping vaults in their homes.

“We cannot allow them to be banks in their homes. They don’t have the license to build bank vaults in their homes. They should release that money back to CBN because what they are doing is undermining monetary policy. They are keeping those monies to speculate against our currency and it is making our work difficult in CBN,” he noted.

He said apart from the monetary policy goals, the naira is also being redesigned to check high insecurity across the country including terrorism, kidnapping and banditry

“I think kidnapping and ransom taking, somehow has reduced. Security agents are doing a fantastic job. But I think that it has slowed those people down because they know that collecting old notes is not going to help them.

He said the CBN has made every effort including awareness campaigns especially in the rural areas to ensure no one is left out.

He encouraged everyone, including those who are scared of consequences especially from the Economic and Financial Crimes Commission (EFCC) and the Independent Corrupt Practices and Other Related Offences Commission (ICPC), to deposit their stashed funds and that there is nothing to fear.

“Nobody is going to harass you if you are afraid of being harassed. Trust me, we have begged the EFCC and ICPC to please allow us do our work so that people can bring their money in,” he stressed.