CBN to punishes commercial Banks with fine of N1million per day for refusing to pickup new Naira notes

The Central Bank of Nigeria (CBN) is taking punitive measures against commercial banks that refuse to pick up and disburse new naira notes to their customers ahead of the 31st of January 2023 deadline. The CBN has imposed a fine of N1million per day for each box of new naira notes that is not collected.

This was revealed by the Deputy Director, Research, CBN, Adeleke Adelokun during a sensitisation programme organised for Osun market women at Ayegbaju market to acquaint them with the new Naira notes of N200, N500 and N1000.

He added that the CBN has printed enough new naira notes, however, banks have refused to pick them up. The Branch Controller of CBN, Osogbo branch, Madojemu Daphne stated that Nigerians have hoarded the old naira notes to the tune of N2.7 trillion.

The Kano Branch Controller, CBN, Alhaji Umar Ibrahim Biu, refused pleas from Nigerians to extend the deadline and insisted that the old naira notes of N200, N500 and N1,000 will cease to be legal tender after January 31. He also spoke during the apex bank’s sensitisation tour of the new naira notes in Kano metropolitan markets, which was organised principally for traders.

He informed the audience that the new naira notes have been produced enough for distribution to all the commercial banks in the country and threatened to slam sanctions on commercial banks hoarding the newly designed banknotes.

He said the traders have the right to report any bank found either hoarding the new naira notes or charging customers before allowing them to deposit their old naira notes.

The CBN has directed commercial banks to desist from payment of new naira notes on the counter, except through ATMs, as part of efforts to check favouritism of customers regarding the new currency.

The Nigerian Economic Summit Group has identified two factors that contributed to the devaluation of the naira in 2022. The first was inflation which the NESG said weakened the naira by 14.9 percent and the second was the naira redesign policy of the Central Bank of Nigeria which “triggered the devaluation of the country’s currency”.

This information is contained in the 2023 Macroeconomic Outlook Report of the NESG titled ‘Nigeria in Transition: Recipes for Shared Prosperity.’

The report said that the purchasing power of N1,000 in January 2022 tumbled to N851 by the end of the year, worsening “the various forms of poverty – monetary and non-monetary deprivation – and contributed to Nigeria’s multi-dimensional poverty”.

It added that the naira depreciated by 2.4 per cent and 30.01 per cent in the Investors and Exporters and parallel market rates respectively and that the naira depreciated, especially at the parallel market, due to the move by the CBN to redesign the country’s currency.

The NESG predicted that inflation will likely average to 20.5 per cent in 2023 and the unemployment rate will increase by 37 percent with a poverty headcount at 45 per cent this year.