The Central Bank of Nigeria (CBN) has said the N200, N500 and N1,000 old naira notes are slowly being phased out with the redesigned ones.
Acting CBN Governor, Folashodun Shonubi, made this known on Tuesday after the apex bank’s Monetary Policy Committee (MPC) meeting in Abuja.
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The CBN also increased the Monetary Policy Rate (MPR), which measures interest rate, from 18.5 per cent to 18.75%.
Fielding questions from reporters, Shonubi said, “When a currency is printed and sent out, it is expected that it will go through a number of cycles, and then over time, will become one and then be replaced. That’s what we’re doing.
“We had to put out or re-put out old notes. And as they’re coming in, they’re being processed and returned to us as not issuable. We are then bringing out and replacing them with the new notes.”
Shonubi said there is an “optimal level of currency” in circulation and what is being done at the moment is replacing worn-out notes with new ones.
“We believe that we have an optimal level of the currency out there and so much of what’s being done is a replacement to keep the level, rather than just putting money out there,” he said.
“And that is seen by the fact that the banks, whenever they come to us for notes, we provide it to them. If it wasn’t enough, they will be asking us for more. If it was too much, they’ll be dumping that much more on us.
“So, we will slowly, and over time you will see the old notes replaced out of the system with the new notes that’ll be the norm.
“And that will be out of practice, not fanfare, you’ll just see it slowly morph from old to new.”
Last October, now suspended CBN Governor, Godwin Emefiele, announced plans to redesign the three highest naira bills and asked Nigerians to deposit their old notes before January 31, 2023, when they would cease to be legal tender.
The naira crunch caused economic turmoil as many Nigerians suffered hardship, leading to riots in some states and the burning of some banks and Automated Teller Machines (ATMs).
The apex bank subsequently said then President Muhammadu Buhari had approved an extension of the deadline for the naira swap.
Some then governors of the All Progressives Congress (APC) dragged the CBN and the Federal Government to the Supreme Court and the apex court ruled in March 2023 that the old N200, N500, and N1,000 notes would remain as legal tender until December 31, 2023.