As the redesigned Naira notes goes into circulation, Nigerians are reacting. Some are reacting positively to the redesigned Naira notes while others are not impressed by what they experience in their banks. That is always the problem with change. When there is a new policy different from what people are used to, there is bound to be one form of resistance or the other from the people.
Besides, the necessity for a cashless economy, the rate at which inflation is accelerating is a major source of concern not only to the Central Bank of Nigeria (CBN) but also to most Nigerians.
The CBN has adopted many monetary policies to reduce inflation which we learnt has hit a 17-year high of 21.47 percent in November, according to data released by the National Bureau of Statistics (NBS). You will recall that some of the measures taken recently by the apex bank to tackle inflation in my view, were the redesign of the Naira and the introduction of a new cash withdrawal limit.
The CBN had on October 26, 2022, announced confidently its plans to redesign N200, N500, and N1000 notes. This, according to the CBN, would take effect on December 15, while Nigerians are to exchange their old Naira notes for new ones not later than January 31,2023.
I learnt that the CBN Governor was of the view that the redesigned local currency became imperative to tackle inflation, currency counterfeiting, insecurity and other societal ills plaguing the country. Is this true?
Anyway, the CBN Governor was quoted as saying that “the Naira redesign was targeted at controlling currency in circulation as well as ransom payments to terrorists and kidnappers.
“How will this drive for a cashless economy benefit most of our people? Is there any hope for the common man?
“The policy continues to generate controversy because it is strategy driven. Normally, it is policy that should drive strategy. Before any policy is formulated, it requires critical thinking in consultation with all stakeholders. One could see from views expressed by public intellectuals that most stakeholders were not carried along before the policy was formulated. Despite the CBN Governor’s ideas on having a cashless economy, many people are agitated, with most of them arguing that the redesign of the currency notes and the limited period given for its implementation may bring the nation’s economy to its knees.”
“The National Assembly (NASS) has directed the CBN that the policy should be reviewed as it may have a negative impact on the economy. But the CBN Governor insisted that there is no going back on the December 15, 2022, date for the introduction of the new currency.”
On December 15, most Nigerians who went banking were disappointed. In fact, some of them expressed their displeasure. Why? Because they are uncertain about the impact the drive for a cashless economy by the CBN would have on them both in the short and medium terms, respectively.
“The Naira redesign is not the actual issue, but the monetary policy which the CBN has decided to propose and impose at the same time.” “Every country has similar policy to aid the appreciation of its currency.”
“The decision was a waste of time and resources.”
“Why did you say that the policy is a waste of time and resources?”
“When you are talking about the creation of new notes, there is no significant impact whatsoever on the economy. It is only mere renewal of notes.”
“It is only repackaging without any economic effect. It is like buying new shoes and throwing away old ones.” People say it is going to stop some of our people from keeping large sums of money in their homes. I don’t think this is true. Those who are used to keeping money at home will continue their act once the new notes are in circulation.
“Is that your fear? Yes, it is.”
“From my own assessment, it’s like the CBN wants to reduce the money in circulation.” But another is this: “Why did CBN have to spend large amount of money to print money when those who want to keep money would continue to do so even after the old ones have been taken out of circulation?”
“So, it is a wasted effort. Whosoever is behind this scheme or whatever you call it should be questioned.”
“For me, I strongly believe the decision was a right one to take at this time when the Naira value has depreciated. The changing of Naira notes is okay. It will help change the dirty and worn out notes and discourage people who are keeping the money inside their homes.” What I don’t fully understand is the cash withdrawal limit plan. The reason behind that has not been properly explained. The new Naira is very good.”
“It is unbelievable that currency hawkers, party goers, and VIPs were busy mopping up new notes towards the end of last week.”
“As demand soars, banks ran out of new Naira notes.”
“The North kicked against N20,000 withdrawal limit as the Arewa Consultative Forum was of the view that the policy will destroy the poor.” “What is the South saying?” Nothing at the time of writing this article.
Since new Naira notes enter circulation on December 15, banks have reconfigured their Automated Teller Machines (ATMs).
“Honestly, I see the Naira redesign as a means by which the CBN has lawfully managed public funds cleverly.” A huge amount of money was expended on this so-called Naira redesign.”
“Achieving the purpose of checkmating the kidnappers asking for ransom in cash, only time will tell of its effectiveness.”
“In terms of aesthetics appeal, I do not like the new notes. In terms of what it is to achieve, I totally agree.”
“The benefits of having new notes outweigh the challenges, in my opinion. It is not in doubt that we are in a corrupt society and with the coming elections in 2023, I would not be surprised if some politicians are strategizing to have Naira notes stored somewhere to buy votes.”
“Let us wait and see if this move by the CBN will curtail vote buying in cash. Hmm, politicians! They always find ways not to comply with laws and policies.”
Read also: Inside Nigeria’s quest to go cashless
“What are the experts saying?”
“I see the CBN’s cash limit claim to fix inflation, improve the value of the Naira and reduce vote buying as counterfactual to economics. Inflation does not respect the color of any currency, but to its capacity to enable the exchange of goods and services.”
“What the CBN policy will do is lead to a rush for new Naira notes, seeing that time is running out fast before the old notes become obsolete.” I guess the rush will be in two forms. The first is to exchange the currency notes for the new notes. The second we can say is that the bulk of the transactions will involve changing dollars to the Naira.”
“The Naira appreciate slightly at the parallel market. Though the timing is not right. It will slow down economic activities this festive season as most of the transactions will be in cash. As we get to the deadline, we will arrive at a point where people will reject the old notes. The rejection rate will increase as we approach the deadline. This is likely to slow down economic transactions.”
“While the CBN is advised to resist further monetary policy tightening, anyone found to be contravening the monetary and fiscal policies should be prosecuted to the full extent of the law.” We urge the CBN to manage the change and pursue the drive for a cashless economy.” Thank you.
