New naira notes yet to circulate amid fear of counterfeiting

• Redesign, withdrawal limit will wreck north, Wamakko claims • Ibadan motorcyclists reject new notes
• Bank of England unveils King Charles III banknotes, won’t phase out old notes but reprinting will be discontinued

Just a week into the introduction of new naira notes by Central Bank of Nigeria (CBN), checks have shown that many states are yet to receive reasonable share of the currency.
From Lagos to Rivers, Oyo to Borno, the narrative is the same. The notes drop in trickles, with Automated Teller Machines (ATMs) still dispensing the old denominations.

Meanwhile, reports of fake notes are flooding media space, making players in the informal sector increasingly wary of new banknotes.
In the face of continuous debate on appropriateness of handing down a tight demonetisation timeline of old notes, the Bank of England (BoE), yesterday, unveiled the King Charles III banknotes.

To “minimise the environmental and financial impacts” of the change, old notes will continue to exist side-by-side with the new ones, allowing them to phase out naturally. Worn-out bills, the BoE said, would not be replaced going forward.

“The King’s portrait will appear on all four of our polymer banknotes (£5, £10, £20 and £50). The rest of the design on the banknotes will remain the same. The King’s image will appear on the front of the banknotes, as well as in the see-through security window. You can check these notes in the same way you can check our polymer banknotes featuring Queen Elizabeth II…

“You will still be able to use polymer banknotes that feature the portrait of Queen Elizabeth II. Banknotes featuring Queen Elizabeth II and the King will be in circulation at the same time.
“The new banknotes will only be printed to replace those that are worn and to meet any overall increase in demand for banknotes. Our approach is in line with guidance from the Royal Household, to minimise the environmental and financial impact of this change,” a notice released on the Bank’s website reads.

On the other hand, Nigerians have just between now and January 31, 2023 to return old notes in their vaults and have them replaced with new ones.


Some experts have faulted the rigid timelines and called for a flexible process that would allow the old naira notes to phase out over time.

But damning the criticisms, National Association of Nigerian Students (NANS) applauded CBN Governor, Godwin Emefiele, for the decision to redesign the naira and pursue, more aggressively, implementation of the cashless policy, which started 10 years ago.

But with about 40 days to phase out the old notes and six days into circulation of the new, most Nigerians are yet to set their eyes on the redesigned legal tenders.

In Port Harcourt, Rivers State, some bank workers along Ikwere Road revealed that they received very limited quantities of the new notes.
Branches on Ikwerre and Aba Roads showed that customers were still being paid the old naira notes. Also, some ATMs were still dispensing the bills, with most bank users saying they had not seen the new N1,000 denomination.

When the reporter disguised as a bank customer to withdraw the new notes from an old generation bank on Ikwere Road, one of the staff at the counter, said: “It depends on the amount you are collecting, because we have limited new naira notes.”

A branch manager of one of the new-generation banks, along Aba Road, said he had been receiving complaints from customers, asking why his branch continues to dispense the old notes. He said those who have collected the new notes also complained that the texture of the money looks inferior to the old one.

He added: “The cashless policy will affect the customers because you do not expect a person to deposit all his money and be happy to be conditioned on how to withdraw it. But our role is to carry out whatever policy CBN puts out there.”

Reacting, Lucky Goodness, a customer at one of the banks, said: “Yes, I have seen the new naira note. I have seen the N1,000 note but not all the denominations.”

Also, George Erezi, said: “For me, the redesigned naira note is a good initiative because CBN wants to checkmate cash flow and track the naira in circulation. But to the masses, such policies are very harsh, especially on small-scale businesses. For instance, from January 9, with the application of the new policy, the withdrawal limit will be N20,000 per week, which is very harsh. With the situation in the country, it is going to wreck a lot of businesses in the country. Both small and medium-scale businesses will go bankrupt and many people will be unemployed.

“The note itself, to me, is not something that seems to be an improvement on the old one. It looks inferior; it looks more like counterfeit.”


In Ibadan, many banks and ATMs were still dispensing the old notes. During a visit by The Guardian to a popular commercial bank, the tellers were seen giving out old notes. Many residents also claimed they had not seen the new notes.

Another twist is rejection of the new notes by motorcyclists. A motorcyclist in the Bodija area refused to collect the money, saying the N1,000 note is fake, on account of its colour. Other traders equally expressed this concern.

A POS operator, Dayo Oyadeji, said he preferred the old notes. According to him, “The quality of the note is low. It is prone to counterfeiting. It is not as good as the old one. If it is mistakenly washed alongside clothes, it is gone. I prefer the old one. Let us be using the old one.”

A businesswoman, Mrs. Idowu Oriloye, said she had not seen the new money, adding: “The information I got is that there are lots of new fake notes in town. I will not collect them. As we speak, people are rejecting them. They are not as good as the old.”

Visits to several commercial banks, POS operators, ATM and business centres showed that old notes were still being used to transact business.


It was also discovered that many people in possession of the new notes were reluctant to spend them, deciding instead to hoard them.

A trader at Gbagi Market in Ibadan said, on account of unstable policies of the government, it could be wise for people to hoard the notes.

Although many commercial banks have started paying with new notes, the outflow remains largely insufficient.

A customer, who came to a first generation bank, said he only received one new N1,000 note, out of the over N20,000 he withdrew from the counter.
Another resident who withdrew money from one of the ATMs at Mokola, said: “The machine still dispensed the old notes.”

Also at Ojoo and Iwo Roads, most of the POS operators were using old notes to pay their customers. They complained that the banks were yet to give out the new notes.
IN Kano, the new currency is in short supply, as commercial banks continue to dispense old notes.

“We queued up to withdraw some money here. As you can see the cashier has given us old notes, despite the fact that the Central Bank released the new currency to commercial banks about a week ago,” some customers told The Guardian at banks along Zoo Road and Murtala Muhammed way.

A bank customer, Aminu Yahaya, who was issued new notes worth N3,000 out of the N30,000 he demanded, alleged that the currency was being diverted to politicians and bureau de change operators.
Investigation revealed that some residents bought the redesigned notes from black market operators, who had acquired them from unofficial channels at commercial banks. These were then sold to end users for a fee.

Isa Abdullahi, a businessman, told The Guardian: “I met one of the operators who sold the new notes to people who spray them during social events, like parties or wedding receptions, as a status symbol.”

There were also reports of fake old naira notes circulating, with many residents saying they had come across such during transactions.

A victim, Ade Samuel, said he withdrew money from a POS operator, only to discover some of the notes were false.
Meanwhile, from Abuja, NANS, which commended Emefiele, urged CBN to come up with stiffer measures that would save the naira from further depreciation.

NANS, in a statement by its Senate President, Comrade Felix Attah Nnalue, at the end of an emergency meeting, argued that the policy would curtail nefarious activities of money launderers and drugs dealers.

The students’ body urged Nigerians to embrace the change, while banks improve upon their online applications to boost consumer confidence.
The group expressed concern that Nigeria, which is Africa’s largest economy, has experienced an unbelievable exchange rate in the last seven years, which needs to be stabilised.

It noted: “We cannot continue like that. The CBN must come up with stiffer measures that will save our naira. We cannot abandon our currency to the activities of money launderers, exchangers, drug and narcotics traders and the bewildering information that over 80 per cent of the currency in circulation, over N2.7 trillion, is outside the banks. What are our law enforcement agencies doing?

“Our interest is in the future of Nigeria. This is why we support the redesign of the naira, so that N2.7 trillion and more should go right back into the banks. The currency change is necessary at this political period. It is long overdue.

“Even stakeholders agreed that the advantages of the cashless policy and redesign of the naira far outweigh its vilification. It helps in effective monetary policy, fighting corruption, stabilisation of the exchange rate, reducing inflation, and ensuring free and fair elections.

“While a lot of concerns have been raised over the withdrawal limit, it is commendable. Nigerians are always afraid and impatient about everything, even progress. The strategic limit seems harsh for political bandits. In the same way, they rejected Bank Verification Number (BVN).

“There was a drastic fall in the exchange rate as soon as the policy was announced. There have been humongous deposits coming into the banks. The masses are looking out for stashed funds. Cash handling fees are available for a fee and more documents are required. We believe and urge Nigerians to embrace this change.”

In another development, Senator Aliyu Magatakarda Wamakko of Sokoto State joined Nigerians in criticising Emefiele over redesign of the naira notes and the controversial cash withdrawal limit set by CBN.

Wamakko, a former governor of Sokoto State, described the twin policies as unnecessarily diversionary, controversial, and designed to plunge Northerners into deeper misery.

Noting that the policies were the sole creation of the apex bank, Wamakko warned that Emefiele would be called to account for all the sufferings that result from the policies.

He said: “We note with concern the imminent hardship on innocent Nigerians that would arise from the CBN’s imposition of harsh policies on cash withdrawal limit, noting especially, that the livelihood of many individuals, particularly, in the North and their enterprises would be impacted.”

He regretted that this is another not-well-thought-out policy initiated by Emefiele and the CBN, plunging the country and especially, Northern Nigeria, into an economic crisis involving high inflation, poor exchange rate and dwindling foreign reserve.

“It is equally absurd that the CBN Governor would so insist on the enforcement of this policy, despite an order of the National Assembly to the contrary, in addition to mounting anger in the land,” he said.

The Senator also noted that the timing of the policy, without adequate preparation and sensitisation of critical drivers of the economy, could prove counter-productive and further drive many people below the poverty line.

“We are bothered that the banking infrastructure and mobile/digital facility to drive the cashless policy in Nigeria and in the North, in particular, are not sufficiently developed,” Wamakko said.

He said the policy introduced by the CBN is totally against Northern Nigeria’s interest, given the region’s lowest financial inclusion rate.

This policy, he said, potentially aims to cripple Northern entrepreneurs who are generally micro and medium industry investors that normally transact and deal with cash payments, given the unavailability of banks in their localities.

“Inadequate banking system, presence, and acceptance in the North, compared to several banks in Southern Nigeria, and the large population of the North living in rural areas with few microfinance banks…this policy will make it difficult for them. There is also non-functioning Internet connectivity in many communities across the North,” he said.

Also, World Bank has aligned with claims that the new policy would negatively impact SMEs and the vulnerable poor in the North.
According to the financial institution, redesign of the notes could have negative effects on the local economy of rural areas.

The World Bank raised the alarm, yesterday in its 2022 new report, titled: “The Nigeria Development Update,” released in Maiduguri, the Borno State capital.
It said: “The naira redesign might harm SMEs and the vulnerable poor; due to its timing and short transition period, slated for January 31, 2023.”

The report warned that the timing of and short transition period for the demonetisation might have negative impacts on economic activities.
It explained that the most affected of the naira redesign are the poorest households living in rural and urban centres.

While citing international experience, the report disclosed: “The rapid demonetisation can generate high short-term costs,” stating that small-scale business operators and vulnerable poor households will be most affected by liquidity squeezes.
“The SMEs and vulnerable poor heavily rely on the day-to-day transactions with cash,” said the Report.

“At present, households and firms already face increased financial pressures from the lingering high costs of food and fuel,” it noted.

The report added that inflation has also hit 24 per cent in six months.

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