The Central Bank Of Nigeria (CBN) on October 26, 2022, announced its new project on the redesign of naira notes such as the N200, N500 and 1000 notes.
The CBN claims that this programme will help Nigeria’s economy become more stable and combat counterfeiting.
The CBN has selected December 15, 2022, as both the date for the distribution of the newly designed naira notes and the beginning of the free exchange of the old notes for the new ones in commercial banks.
To facilitate this policy, some banks have promised to work on Saturdays, solely for the Naira exchange.
Additionally, it has been said that the last day to utilize old naira notes will be January 31st 2023. This indicates that beginning of February 1st 2022, the old naira notes would no longer be accepted as legal money.
Additionally, the CBN outlined justifications for why this new approach will strengthen the Nigerian economy and lower inflation.
The CBN governor, Godwin Emefiele, suggested that up to 85% of the Naira notes may not be in the commercial banks’ vaults in his statement announcing the new policy.
The remaining N2.27 trillion of the N3.23 trillion in circulation, according to him, cannot be accounted for because it is outside the boundaries of commercial banks.
According to the CBN Governor, the current circumstances restrict the CBN’s ability to control the amount of money in circulation through monetary policy.
The CBN controls the overall amount of money in circulation to reduce inflation. It helps to prevent demand-push inflation, which results from the “more money chasing fewer products” concept, by limiting the amount of money in circulation.
The second remedy the new naira design strategy will provide, according to the CBN Governor, is enhancing national security.
Godwin contends that tighter control over money will make it more difficult for thieves and kidnappers to amass wealth or make hefty demands since they won’t have access to as much money outside of the banking system and every naira in circulation will be tracked.
As there have been numerous security reports in the past, Godwin Emefiele also stated that this new invention will lessen counterfeiting.
The CBN urges the populace to support this new policy because it is in their best interest.
There have been numerous responses since the release of this announcement.
Will the introduction of the new naira designs serve the purpose the CBN claim?
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