President Muhammadu Buhari on Wednesday, said the naira notes are long overdue for a change as the current tender has been in circulation for nearly 20 years.
This was as he said the newly redesigned notes have unique security features that make them difficult to counterfeit.
Buhari said this when he launched the new Naira banknotes at the council chamber of the State House, Abuja, shortly before the kick-off of this week’s Federal Executive Council meeting.
According to a statement signed by Buhari’s Special Adviser on Media and Publicity, Femi Adesina, Buhari also expressed delight that the redesigned currencies were locally produced by the Nigerian Security Printing and Minting PLC.
The statement is titled ‘Why I approved the redesign of Naira notes, by President Buhari at the launch of ₦200, ₦500, ₦1000 banknotes.’
Speaking at the launch of the new banknotes, the President noted that international best practice requires central banks and national authorities to issue new or redesigned currency notes every five to eight years.
He lamented that it is almost 20 years since the last major redesign of the country’s local currency was done.
‘‘This implies that the Naira is long overdue to wear a new look.
‘‘A cycle of banknote redesign is generally aimed at achieving specific objectives, including but not limited to: improving the security of banknotes, mitigating counterfeiting, preserving the collective national heritage, controlling currency in circulation, and reducing the overall cost of currency management,” he said.
He added that “the new Naira banknotes have been fortified with security features that make them difficult to counterfeit.’’
Explaining why he approved the redesign, the President said there is an urgent need to control the amount of currency in circulation.
‘‘As is known, our local laws – specifically the Central Bank of Nigeria Act of 2007 – grant the Central Bank of Nigeria the power to issue and redesign the Naira. In line with this power, the Central Bank Governor approached me earlier in this year to seek my permission to embark on a currency redesign project. I considered all the facts and reasons presented before me by the Central Bank.
‘‘There was an urgent need to take control of currency in circulation and to address the hoarding of Naira banknotes outside the banking system, the shortage of clean and fit banknotes in circulation, and the increase in counterfeiting of high-denomination Naira banknotes.
“It is on this basis that I gave my approval for the redesign of the ₦200, ₦500 and ₦1000 banknotes,” Buhari said.
The President said while it may not be apparent to many Nigerians, only four out of the 54 African countries print their currencies in their countries, and Nigeria is one.
“That is why it is with immense pride that I announce to you that these redesigned currencies are locally produced right here in Nigeria by our Security Printing and Minting PLC,’’ he said.
He added that the new banknotes would help the Central Bank design and implement better monetary policy objectives as well as enrich the collective memory of Nigeria’s heritage.
The President commended the CBN Governor, Godwin Emefiele and his Deputies for the initiative while also thanking the Managing Director, Executive Directors and Staff of the Nigerian Security Printing and Minting PLC “for working tirelessly with the apex bank to make the currency redesign a reality, and for printing the new Naira notes within a comparatively short time.”
Briefing State House Correspondents after the ceremony, the CBN Governor argued that the new move is not targeted at anyone.
Instead, he said, the redesigned notes would give the apex bank ample control over the amount of money in circulation.
He added that the past attempts to redesign the naira notes were resisted.
According to him, “The Central Bank of Nigeria, by law, has the mandate to reissue and redesign currency for the country, and for Nigerian people, every five to eight years. And I want to hope that after the event of today, the Central Bank of Nigeria can take it as part of its programmes to see that the currencies are designed or reissued every five to eight years.
“It is mainly because the central bank should be able to control the size of currency in circulation fully. That is the actual mandate of the Central Bank of Nigeria because it has implications for monetary policy management in the country.
“There is no need for anybody to think this program is targeted at anyone. Like you heard the President, he said, this discussion to redesign and reissue currency started early in the year.”
At the briefing, Emefiele added that the amount of money that can be withdrawn from the counter would be reduced drastically, adding that bulk withdrawals would require several procedures and security checks to track use.
He said this would ensure a steady transition into a cashless economy.
“There is no economy imbued with the thinking that it has to be a cash economy; the world has moved from predominantly cash to a cashless economy. And I think Nigeria and the Central Bank of Nigeria are prepared to move towards a cashless economy. And that is why following the redesign and issuance of this note, we will insist that cashless will be nationwide.
“We will restrict the volume of cash that people can withdraw over the counter. If you need to draw large volumes of cash, you will fill out uncountable forms; we will take your data, whether it’s your BVN or NIN so that our law enforcement agencies like EFCC and ICPC can follow you and be sure that you are taking that money for a good purpose,” he said.
The CBN governor also argued that Nigerians have ample time to return the old notes in circulation and will not extend January 31, 2023, deadline.
According to him, “What we are saying is, we announced this program on October 26, 2022. And we have said that from today, this currency that is issued will be legal tender in Nigeria. So between October 26 and January 31, 2023, we believe that is over 100 days.
“As the President has said, if you have cash, it should not take more than 100 days to deposit it in your bank and take whatever money you need. We have made adequate arrangements. The banks have been told to keep their currency processing centres open from Mondays to Saturdays, even to late hours every day. We have also offered that the Central Bank of Nigeria currency processing centres across the 36 states of the federation, including Abuja, will be available to process cash from Mondays to Saturdays.
“We have also made available through our agency banking arrangement. In 2018, we had 86,000 touchpoints for agency banking. As of October last month, the number of those with banking system touchpoints under our agency banking arrangements is 1.4 million points. So, there is no local government where you don’t have agent bankers that can do this on our behalf.”