NAIRA REDESIGN: SOME QUESTIONS THE MSMEs RAISED

 Report by Chinazaekpere Nnabugwu

Some of the previous denominations of the Naira Notes and Coins

The central bank of Nigeria (CBN), which some people will rather call the Apex bank, and others the bankers bank is vested with the responsibility to issue and manage the legal tender currency in Nigeria. The legal tender in Nigeria is comprised of the Naira, Kobo and eNaira. Furtherance to the fulfilment of this part of CBN's responsibility, the bank recently (late 2022) came out with a policy to redesign three out of the 8 currency denominations of the country's legal tender banknotes. The affected notes are the:

• N200
• N500
• N1000

The notes not affected by the policy are the:

• N5
• N10
• N20
• N50
• N100

On October 26, 2022 the Governor of the Central Bank of Nigeria Godwin Emefiele, announced that new Naira notes will be introduced to replace the old Naira denominations of  N200, N500 and N1000. On November, 23, 2022, the new Naira notes of  N200, N500 and N1000 were launched by the President of Nigeria, Mohammadu Buhari. 

In keeping with our avowed commitment to follow up with issues that concern the MSMEs, especially, the policy related. In view of this we went into the streets and visited some markets to assess how the MSMEs are relating with the challenges associated with currency redesign, in particular, swapping the old notes for the new ones. We observed in the course of this self-imposed monitoring exercise in Jos, the Plateau state capital, something of interest that we wish to share with you, our very dear esteemed reader.

While interviewing most especially, the Micro and Small business operators, our reporter encountered some questions, the answers to which we have decided to share with you on this Platform. We do this having seen the interest and concern shown by those that asked the question, hence the decision to share the answers here for the enlightenment we envisage from it to reach far more than those that raised the issues, so much so when we know that Micro and Small enterprise operators are scattered in all the 774 local government areas in Nigeria, many of whom may benefit from  the answers we have provided.

Our reporter was confronted with the following questions:

• Why changing or redesigning the Naira notes?
• Why would it be now?
• Is there a limit to how much an individual can deposit?
• Are the charges on deposits applicable in this instance?

From information made available to us from the CBN, we share with you the responses below:

Why redesigning the Naira notes? According to a document made available to our reporter by the CBN, which reads, "Data have shown:

• Large volume of banknotes are hoarded by some members of the public
• Heavy shortage of clean and fit bank notes
• Increasing rate of counterfeiting in the country"

Why would it be now? The insight we gathered on this is that a global standard or bench mark for redesigning a country’s currency, is between five and 8 years. Going by this development, the redesigning of the Nigerian currency, the Naira in 2022 is long overdue, according to the CBN.

Is there a limit to how much an individual can deposit? There is no limit in the quantity, amount or value of the N200, N500 and N1000 notes that an individual, company, group or organization can deposit.

Are the charges on deposit applicable in this instance? The CBN suspended charges on bank deposits till January 31st 2023, now extended to February 10.

Before signing off, we wish to draw the attention of the reader that the CBN did not remove or introduce any inscriptions in the redesigned Naira notes. 

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