The Central Bank of Nigeria on the 26th of October, 2022 announced its intentions of redesigning Naira notes consisting of the ₦200,₦500 and ₦1,000 respectively
An announcement which was made by the CBN Governor, Godwin Emefiele who also indicated that the Naira notes will begin circulation from the 15thb of December 2022 which will be used with the existing notes until it’s deadline which as fixed for 31st of January 2023 by the CBN.
The new development has sparked a few questions like why now? What does this mean for the country’s economy?, What does this mean for entrepreneurs?
As indicated by CBN, there has been an increase in hoarding of naira notes which also implies that there’s a huge amount of people are holding on to money without spending it.
There are also reports according to CBN indicating that N2.73 trillion out of the N3.23 trillion currency in circulation, was outside the vaults of commercial banks across the country which is supposedly held by the public.
Other concerns have necessitating the redesign of the naira notes include
Shortage of clean and fit naira notes
According to CBN, there’s a shortage of clean naira notes in circulation which has led to the increase in counterfeiting especially the N500 and N1,000 notes.
Naira notes has not been designed in a long time
For over 20 years, Naira notes have not been redesigned which goes against the global best practices that require the redesigning of National currencies every 5 to 8 years.
What you should know
The said New Naira notes will be circulation from December 15, 2022. In order to create room for circulation, the legal tender would be acceptable as a means of exchange for the purchase of goods and services. Old legal tender can be paid into your bank accounts immediately bearing in mind that the deadline for the return of Naira notes will begin from 31st of January 2023 while the new naira notes will only be issued from 15th of December.
There are also indications that bank charges for cash deposits would be suspended effective immediately which means deposit transactions would be done without bank charges to aid circulation
If you are a business owner , it is important to be at alert and keep an eye out for fraudsters intentions of making bulk purchases with fake currency. make sure to inspect the said notes before accepting to sell. for entrepreneurs with businesses in rural areas that are far from banks, it is important to make cash deposits much earlier in order to beat the long queue accompanied with the deadline.
It is also advised to priotize the use of digital channels for transactions and payments instead of holding on to lots of cash which would need to changed in the long run.