By Inawole Ayomikun Oluwatimileyin
“The naira redesign is not the actual issue, but the monetary policy which the Central Bank of Nigeria has decided to propose and impose at the same time.” Says Nigerians.
The CBN Governor, Godwin Emiefiele had on October 26, 2022 announced plans to redesign N200, N500 and N1,000 notes. He said it would take effect from December 15 2022 and Nigerians would have till January 31, 2023, to exchange their old naira notes. Emiefiele explained that the redesign of the local currency became necessary to tackle inflationary problems, currency counterfeiting, insecurity and other issues plaguing Nigeria.
He also stated that the naira redesign was targeted at controlling currency in circulation as well as ransom payments to kidnappers and terrorists.
He emphasised that the action was to challenge significant hoarding of banknotes by members of the public; worsening shortage of clean and fit banknotes with an attendant negative perception of the CBN and increasing ease and risk of counterfeiting evidenced by several security reports.
However, despite Emiefiele’s explanation, a lot of agitations greeted the announcement with many arguing that the redesign of the currency notes and the limited period given for its implementation may bring the country’s economy to its knees.
The National Assembly even asked the apex bank to review the policy as it would have an adverse impact on the economy, but the central bank was resolute, saying no going back on the December 15 date for the introduction of the new notes.
Undoubtedly, the impact of introducing the new naira note has been felt in the rural areas of Kwara state.
For example, the local traders at the Ipata market have voiced out their complaints on the new naira note not circulating and as a result, they have not been able to open up their shops. They voiced out that due to the deadline set by the apex bank, they have been forced to reject the old naira and their customers have not been able to pay for their goods. The traders, most of whom are not literate have a preference for cash over bank transfer and are not knowledgeable or adept in exploring the cashless policy. Thus, they continue to lose as most traders rely on the day to day profit to cater for their needs.
According to a recent McKinsey analysis, there are 17 automated teller machines, 147 point-of-sale machines, and four bank branches per 100,000 Nigerians. The majority of these facilities, which were designed to help Nigeria’s gradual transition to a cashless economy, were somehow crippled to the point where they were unable to provide the services that were required.
Malete is home to students of Kwara State University who have done their share of boosting the economy in the town. However, like other Nigerians, they have not been exempted from the scarcity of the new naira notes. As a matter of fact, the pos operators around Malete have hiked the charges for each withdrawal as a result of the deadline given by the apex bank. They claimed they haven’t been able to withdraw the new notes from the banks to give to the customers.
Therefore, for an individual who withdraws N1000 he or she has to pay extra charges of 100 and 2000 for 2000, 10000 for 1000 and so on. This has resulted in panic among the students as they do not have the money to commute themselves to the school premises or purchase refreshment for themselves.
Furthermore, the students have resorted to online banking and use of the USSD code provided by the various banks but it has caused series of discomfort like bank charges and incomplete transactions.
Despite CBN’s assurances that those in the rural areas would be taken care of through agents, the release of the new naira note has brought about uncertainties, stress, and hunger.
Interestingly, the 10-day extension previously granted by the Central Bank may not help matters because most Nigerians, particularly those living outside of big cities and in rural regions, have not yet seen the new naira notes.
It should be advised that the CBN should try to increase the distribution of new notes in the rural areas and embark on sensitization programs on the use of online transactions.
Inawole Ayomikun Oluwatimileyin writes from Ilorin and is a 200 Level Mass Communication Student of Kwara State University, Malete
