‘A day will come when you will look for your money in Nigeria banks and you won’t be able to access it,’ Mazi Nnamdi Kanu had once prophesied.
By Nightengale Ben-Onyeukwu
Just almost at the tail of 2022, the Central Bank of
Nigeria announced at a press briefing that it has redesigned all major naira notes
and will by December 2022 start circulating them, and therefore, the existing
notes would seize to be regarded as legal tender by January 31, 2023. Why did
the CBN decide to redesign the naira notes? The naira notes was redesigned to
address the issue of individuals who have made currency fraud their main source
of income. Another reason for the currency change was to deal a fatal blow to
the growing kidnapping and ransom industry. The third reason for the change in
notes was to aid in lowering the rate of inflation and the fourth reason was to
control the amount of money circulation.
These four reasons appear to be glowing in the surface
but could these reasons be the main reason for the redesign and swift banning
of the old naira notes? Or is the upcoming general election a major reason for
this redesign and swift banning of the old notes?
About 500 million pieces of the new N1,000, N500 and N200 currency was ordered from the mint due to Nigeria’s weak minting capacity. It seems funny that about 1.5 trillion of the old notes had been returned while a lesser redesigned pieces were printed. Was the CBN cashless policy the reason for the little amount printed? Or could it be that more than 500 million pieces was printed? However, if the majority of the money printed is hijacked by politicians, and very rich businessmen, what would be the fate of low-income earners? If a governor is able to withdraw more than 5 million naira from the redesigned notes, how much would be left for the poor masses?
Has Nigeria ever
experienced money scarcity before? Findings
showed that during the pre-colonial
era, different cultures used a variety of items as means of exchange. These
items such as cowries, beads, bottles, manilas and other stuffs were used as
means of exchange. In Nigeria, the first major currency was undertaken sequel
to the colonial ordinance of 1880 which introduced the Shillings and Pence as
the legal tender currency in British West Africa. Later, the West African
Currency Board issued the first set of banknotes and coins in Nigeria, Ghana,
Sierra Leone and the Gambia, from 1912 to 1959. Then, the highest banknote
denomination was one pound while the one shilling coin was the highest coin denomination.
On 1st July, 1959 the Central Bank of Nigeria, which is now the sole
issuer of legal tender money
throughout the Federal Republic of Nigeria, issued Nigerian currency banknotes,
while the West African Currency Board issued banknotes and coins were withdrawn,
and on the 1st of July, 1962 the currency was changed to reflect the
country’s republican status. The banknotes which had FEDERATION OF NIGERIA, now
had FEDERAL REPUBLIC OF NIGERIA, inscribed at the top. The notes were again
changed in 1968 following the misuse
of the currency banknotes during the civil war.
The government later made the decision to decimalize the
Nigerian currency; abandoning the metric and adopting the decimal currency. The
name of the Nigerian currency was changed in January, 1973.Then, the major unit
of currency which used to be 1 pound came to a halt and the one naira which was
equivalent to ten shillings became the major unit, while the minor unit was
called the kobo. That was indeed a start to a new beginning after the civil
war, a new currency, Naira, was meant
to be the new start for our business transactions.
On 11th
February 1977, a new banknote with the value of twenty naira was issued, and
gradually, other currency banknotes were issued. However in April 1984, under
the leadership of Muhammadu Buhari, during his military regime, the colours of
all the banknotes in circulation were changed with the exception of the 50 kobo
banknotes, with the reason to arrest the currency trafficking prevalent at that
time, and to control the withdrawal of money to foreign countries. And in this
same 1984, the government had granted a two weeks grace period for changing the
old notes, thereby causing a huge shortage in commodities. In that same 1984,
Nigeria had few banks operating in the state capitals and a cluster of cities.
In 1991, the 50 kobo and one naira were both coined.
Due to the expansion in economic activities and because
Nigeria wanted to facilitate an efficient payment system, hundred naira to one
thousand naira banknotes were introduced in December 1999, November 2000, April
2001 and October 2005.
In 2008, CBN introduced the polymer versions of 5, 10,
20, and 50 naira notes, and many citizens welcomed them with open arms while gradually ignoring the old paper note in
the same denominations. However, six years after, many people began rejecting
the polymer currency notes, either because it faded to the point it can no
longer be spent, or it shrunk after a while. Maybe because it couldn’t endure
the too much business transactions, it
began to fade in beauty. It seemed that the polymer banknotes were created to
have short life span. Anyway, the shrinking of the polymer notes and the fading
out of the currency features printed on them never caused money scarcity.
Since 1st October, 1960 was Nigeria’s
Independence, CBN issued a redesigned 50 naira polymer banknote for the
celebration of the nation’s 50th anniversary, on 29th September,
2010, and on 12th
November 2014, in order to mark the 100 years of the amalgamation of the
Northern and Southern Protectorates into a nation-state called Nigeria, the
Central Bank of Nigeria unveiled the new redesigned 100 naira banknote to
commemorate our 100 years as a single nation. Really? Too many redesigns!
However, the old banknotes never stopped being legal tender. They gradually
faded out on their own.
Has Nigeria
experienced money scarcity before? The shortage of commodities in 1984 was
understandable because Nigeria was still in the crawling stage but what could
be the reason for a repeat of 1984 in 2023, from the same head of state,
Muhammadu Buhari, who now serve under the civilian rule as president of Nigeria
since 2015? Then, in 1984, the few banks that operated only maintained branches
in the state capital and never found it of interest to expand into the rural areas.
Many had lost their jobs, businesses came to a halt, people died of
frustration, and the most affected were the traders.
Recently, it was
stated that CBN spent about 281 billion naira for the printing of the naira
notes in five years and about additional N3. 88 billion to destroy mutilated ones
within the same period. The question is, did CBN redesign or repaint the current
naira notes? Why the urgency in the redesign and circulation of the naira
notes; 200, 500 and 1000 which is today affecting everyone? Was the redesign
really for the four reasons aforementioned? Perhaps, truly, the CBN had done
this redesign for the implementation of the cashless policy which would plug fiscal
leakages, for the boosting of government revenues and as well as help the
economic empowerment of vulnerable Nigeria as well as benefit the country as a
whole. However, if that is the case, we should not still forget the fact that
the government OWES and so didn’t need to spend much just to redesign the
aforementioned naira notes! The money spent on the redesigns should have at
least been used to solve the problem of ASUU, pay workers’ salaries and
pensions, create employments and build a beautiful green and white country to
benefit all.
The government should focus on what to do to aid her struggling
citizens to whom they made promises to during election and not on repainting
our naira notes! We are not babies that need new dresses for every birthday; we
are adult who want to build stability for the generation to come. And if at all
the redesign was urgently necessary, then the government or rather CBN should
have learnt from other countries that had their currency redesigned. For
instance, the Bank of England released new designs for British pound banknotes
featuring King Charles III last year, but the old banknotes will remain legal
tender as the new notes are not expected to enter circulation until mid-2024. In
the case of Nigeria redesign, the new notes came in circulation by December of
2022 and just like flash the old notes
were asked to disappear by January 31, 2023 but were extended to February 10,
2023. There should be no hurry in the circulation of the new notes and there
should be no swift disappearance of the old notes. This policy should have been
a gradual process. Why the urgency in the banning of the old notes? Nigeria is
not yet a cashless society just like other advanced countries and yet when such
policies are made in developed countries, they give their citizens enough time.
Instead of the hurry in the stopping of the old notes
from being legal tender, the new currencies should co-exist with the old ones
until the old ones fades away.
This harsh decision of not accepting the old naira notes
is affecting the people, especially the poor masses who now suffer to get the
money they have worked hard to earn, even to the point of sleeping in the bank. The scarcity of money has brought riots in
Nigerian cities as angry protesters are today attacking ATMs and blocking roads
in frustration at the lack of new redesigned banknotes. Banks have limited
access to cash for withdrawals because of the scarcity of the new notes, and to
make everything worst, some businesses refused to accept the old notes, thereby
causing frustration, disrupting businesses, causing long queues, angering customers
or rather citizens to set ablaze the commercial banks in some Nigeria cities.
Since the banks
are no longer operating as they ought to, the people are now doing cash transfer,
which most times have no results. By the way, who are the ones doing the cash
transfer? The forty percent of the citizens! Where did the rest citizens go?
The sixty percent of the population have no access to banks. In this case, what
is the fate of these 60 percent of the population?
Due to this money scarcity, many banks, ATMs, POS, have
shut down, and to make the matter worst, the mobile money transfer are
currently fluctuating due to poor network. People no longer get healthcare
because by the time the doctor receives alert, the patient is already dead.
Traders no longer do business due to scarcity of cash; workers are also
affected, students are now at home because there isn’t enough money to
transport and to buy lunch. Some of the banks that were overcrowded few days
ago are today empty. Customers are no longer sure of their fate but then they
still queue at ATM booths, not because they are sure of getting miracle but maybe believing little in false hope.
What is the government doing to stop this mess? In a
country were the government does not listen to the court order what would then
be the fate of the citizen? Could this be the fulfillment of Mazi Nnamdi Kanu’s
prophecy?
The British-Nigerian political activist who was known to advocate
for the secession and independence of Biafra from Nigeria, and also known as
the leader of the Indigenous People of Biafra (IPOB), which he founded in 2014
had once prophesied before his arrest in June of 2021 that, ‘A day will come
when you will look for your money in Nigeria banks and you won’t be able to
access it’.
Of course, the people are indeed looking for their money in Nigeria banks, their hard earned money
but are not able to have access to it. Due to the shortage of the new currency,
people now sell cash to get cash; people go hungry on daily basis, and
frustration mounting as some citizens can’t purchase basic necessities.
It is quiet
understandable if we say that Nigeria is operating Nigerocracy instead of democracy. By my own definition, Nigerocracy is a form of government were
the country chooses democracy as their form of government but the government
instead chooses to rule the country with hammer
and hardship, thereby causing the
citizens to suffer in pain and poverty, while the government live big in affluence and puff.
If the definition of democracy is government of the
people for the people and by the people, then why is our government not
including us in the decision that they make? Why are the citizens waved behind
when important decisions are made? Shouldn’t there be a forum were the citizens
are allowed to Have Their Say? Don’t
we have the right to tell the government what we want and what we do not want?
Shouldn’t the government listen to their subjects more than they listen to
their power? Shouldn’t they listen to
the court of law? Perhaps, our government is above the rule of law? Does their
veto power also include ignoring their subjects and court order? Are we going
to halt our future just because the government wants things to go their way? Or
should we, the citizen rise up and fight for what is rightfully ours?
Without the citizens, there won’t be existing government
and laws! So, the people have the right to rise at matters like this and decide
their stand. What if they decide to use the old notes among themselves without
complaining? Protest; sometimes do not solve issues but standing tall to decide
the best that would suit without complaining seems the best approach at this
moment. What is best; to locally reject
the old notes during business transactions and wait for when the new notes will
be printed more and maybe die in hunger while waiting for a journey thus far or
to still continue using it as legal tender and settle rising bills? Even the
few months’ extension to the use of N200 naira old note won’t be able to solve
the problem of money scarcity.
Two solutions; allowing the old and new notes to co-exist
until the old notes completely disappear. If such won’t be supported by the CBN
and the federal government, then the number two would be to internally use the old notes among the
citizens. Implementing number two solution would be breaking the law but then;
a hungry man doesn’t know what law is until after having a full stomach.
Therefore, the people want nothing more but a peaceful approach to this money
scarcity to avoid breaking the law.
