The Central Bank of Nigeria (CBN) anticipates a minimum of 2 trillion naira ($4.3 billion) to flow back into banks by January 31st when the cut off for exchanging large denomination bills was expected to end. However, the deadline has been extended until February 10 2023 to allow for more collection of the old notes.
Central Bank of Nigeria extends the deadline for the return of old series of 200, 500 and 1000 naira notes from January 31, 2023, to February 10, 2023, to allow for the collection of more old notes…https://t.co/HkT4ES90vK pic.twitter.com/hrdS4bJqbe
— Central Bank of Nigeria (@cenbank) January 29, 2023
The deadline follows a CBN direction which required that old notes be exchanged for the new ones by end of January 2023.
According to CBN Governor, Godwin Emefiele, residents have swapped as much as 1.5 trillion naira worth of old notes as of last week. He made the statement to reporters in Abuja on January 24 2022.
“We are hoping that getting to this week, we will move closer to 2 trillion naira,” he told Bloomberg magazine.
In November 2022, Central Bank of Nigeria, for the first time in 19 years, unveiled re-designed notes to replace the previous N1,000, N500 and N200 notes.
President Muhammadu Buhari launches the newly redesigned Naira Notes at the State House, Abuja. pic.twitter.com/LieMvYl87e
— Government of Nigeria (@NigeriaGov) November 23, 2022
According to Governor Emefiele, Nigeria’s cash in circulation has more than doubled since 2015 to 3.23 trillion naira, which suggests that people are hoarding it, people are keeping vaults in their homes.
“We cannot allow them to be banks in their homes, they don’t have the license to build bank vaults in their homes. They should release that money back to CBN because what they are doing is undermining monetary policy, they are keeping those monies to speculate against a currency, which is making our work more difficult.” Emefiele said.
The Central Bank of Nigeria has allowed citizens in rural areas without bank accounts or limited access to financial services to exchange old notes for up to 10,000 Naira per person without having to open a bank account. The exchange can be done through banks or agents.
CBN is collaborating with 1.4 million agents and lenders to reach citizens nationwide and exchange old notes for new ones or open bank accounts. The Governor stated that using representatives to reach rural areas eliminates the need for an extension of the deadline.
Emefiele warned that those who do not exchange their old notes by January 31 2022 will be left with ‘useless’ cash.
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