CBN Directs Banks to Begin Over The Counter Payment of New Naira Notes

The Central Bank of Nigeria (CBN) has directed deposit money banks (DMBs) to begin the payment of the redesigned naira notes over the counter, reversing earlier directive that prohibited the banks from doing so.

The directive comes amid growing chaos emanating from scarcity of the redesigned naira notes, which has left people and businesses suffering across the country.

In a statement signed by the CBN’s Director, Corporate Communication, Osita Nwanisobi, the apex bank said the new directive is subject to a maximum daily payout limit of N20,000.

The earlier directive, which forbade banks from issuing the new naira notes from the counter, was meant to stop banks from making a few of their customers a priority, but it compounded the hardship unleashed by the scarcity of the new naira notes.

It was also undermining the circulation of the redesigned naira notes since the few ATMs dispensing them give out only N1,000 notes. The situation forces people to rely on lower denomination of the old naira notes (N200 & N500) to complement transactions, leaving a vacuum stymieing CBN’s efforts to mop up the old naira notes in circulation.

But in the statement, the CBN said it is committed to seeing to the effective distribution of the redesigned naira notes. The financial sector regulator urged Nigerians to be patient as it works assiduously to address the challenge of long queues at ATMs.

The statement said the CBN has observed with grave concern, the activities of persons who sell the newly redesigned banknotes and those who flagrantly abuse the legal tender by hurling wads of naira notes in the air and stamping on the currency at social functions.

“We have equally noticed the queues at Automated Teller Machines (ATMs) across the country and an upward trend in the cases of people stocking and aggregating the newly introduced banknotes they serially obtain from ATMs for reasons best known to them.

“Also worrisome are the reported cases of unregistered persons and non-bank officials swapping banknotes for members of the public, purportedly on behalf of the CBN.

“We wish to state unequivocally that, contrary to the practice of these unpatriotic persons, it is unlawful to sell the Naira, hurl (spray), or stamp on the currency under any circumstance whatsoever,” it said.

While Nigerians struggle to get hold of the newly introduced naira notes, scores have been noticed swapping them for profit.

The CBN said in the statement that the perpetrators are breaking the law. Quoting Section 21(4) of the CBN Act, the apex bank said: “It shall also be an offence punishable under Sub-section (1) of this section for any person to hawk, sell or otherwise trade in the Naira notes, coins or any other note issued by the Bank.”

The CBN said it is collaborating with the Nigeria Police, Federal Inland Revenue Service (FIRS), the Economic and Financial Crimes Commission (EFCC) and the Nigerian Financial Intelligence Unit (NFIU) to address the unpatriotic practice.

Nwanisobi admonishes members of the public to embrace and adopt other payment channels for their transactions.

However, the CBN reversing its earlier directive to banks regarding issuance of the new naira notes is seen as a sign of desperation to tackle the challenges of the redesigned naira notes implementation as its February 10 deadline draws near.

The central bank earlier fixed January 31 as the deadline for the old naira notes to be returned to banks, but was forced to extend it as the circulation of the new naira notes significantly stalls.

The central bank governor, Godwin Emefiele, had on Tuesday, assured the House committee looking into the policy that the public will be able to return their old naira notes to the banks after the deadline, but reverses himself after, reiterating that the old notes can only be deposited at the central bank post February 10.