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RECENTLY, the apex bank under the new monetary policy to stop vote buying in the 2023 elections fixed weekly cash withdrawals for individuals at N100,000 and corporate bodies at N500,000. Maximum cash withdrawal at POS terminals has also been reduced to N20,000 daily. The policy is expected to take effect nationwide from January 9, 2023. To forestall the future harbouring of naira notes by individuals, the central bank came up with another policy pegging N100,000 and N500,000 as the maximum cash individuals and corporate organisations respectively can withdraw weekly. This policy will also help to checkmate the incidences of vote buying, which is the greatest threat to fair and credible elections in 2023. Those with looted funds in their houses should find a way of depositing such monies in any commercial bank rather than trying to use a back door approach to knock off the CBN governor and get the policies reversed through their lackeys.
The main reason the Nigeria government is redesigning some denominations of the country’s naira is to mop up the money outside the control of the CBN. In a press conference addressed by the Central Bank of Nigeria, CBN, governor, Mr. Godwin Emefiele, said 2.7 trillion out of 3.23 trillion of the total money in circulation is outside the banks’ vault. He reiterated that one of the core reasons behind the redesigning is to ensure all the currencies outside the bank vaults return, and the CBN regains control of money in circulation. This is a strategic blow against politicians who have saved trillions of naira in their houses to influence 2023 elections. The strategic step will put pressure on politicians who are not popular in their constituencies. One of the most sought after commodities right now in Nigeria, is voter’s card; not just any, but the permanent one which goes by the acronym PVC.
The redesign of the naira will address vote-buying and the purchase of permanent voter cards in this year’s elections. The case filed by the Socio-Economic Rights and Accountability Project (SERAP), is an indication of growing concerns around the illicit practice ahead of the crucial 2019 elections. Vote-buying has always played a role in Nigeria’s polls, but many have been outraged at the apparent brazenness with which party officials have sought to sway voters in recent contests. Politicians that have created personal bank vaults at home have been disappointed by the CBN. With Nigeria in the election season, the sudden CBN’s policy is expected to create some shock in the system, and affect politicians who have amassed huge financial war chests to prosecute the 2023 election, as all old currencies are expected back to the vault by 31 January, 2023. The EFCC, Abdulrasheed Bawa, boss said: “The objectives which the CBN seeks to achieve with the redesign and reissue of the higher denomination Naira notes, are in tandem with the objectives of the Money Laundering Prevention Prohibition Act 2022, which criminalises the conduct of cash transactions above a certain threshold.”
According to Section 2 (1) of the Money Laundering Act 2022 “No person or body corporate shall, except in a transaction through a financial institution, make or accept cash payment of a sum exceeding— (a) N5,000,000 or its equivalent, in the case of an individual ; or (b) N10,000,000 or its equivalent, in the case of a body corporate.” Optimistic that the new currency measure would further boost Nigerians’ embrace of banking culture and encourage the acceptance of cashless transactions, the EFCC chairman recalled that the commission had recently taken operational action against currency hoarders in major commercial cities of Nigeria. “It is therefore pertinent to issue this stern warning to Bureau de Change operators to be wary of currency hoarders who would attempt to seize this opportunity to offload the currencies they had illegally stashed away.”
In April 1984, the colours of all the banknotes in circulation were changed with the exception of the 50 Kobo banknote to arrest the currency trafficking prevalent at the time. In 1991, the 50K and ₦1 were both coined. In response to the expansion in economic activities and to facilitate an efficient payments system, the ₦100, ₦200, ₦500 and ₦1000 banknotes were introduced in December 1999, November 2000, April 2001 and October 2005 respectively. On 28th February, 2007, as part of the economic reforms, ₦20 was issued for the first time in polymer substrate, while the ₦50, ₦10 and ₦5 banknotes; as well as ₦1 and 50K coins were reissued in new designs, and the ₦2 coin was introduced. On September 30, 2009, the redesigned ₦50, ₦10 and ₦5 banknotes were converted to polymer substrate following the successful performance of the ₦20 (polymer) banknote. Thus, all lower denomination banknotes were now printed in the polymer substrate.
CBN, as part of its contribution towards the celebration of the nation’s 50th anniversary of Nigeria’s Independence and 100 years of its existence as a nation, issued the ₦50 Commemorative polymer banknote on 29th September, 2010; and the N100 Commemorative banknote on 19th December, 2014 respectively. The CBN Governor, Godwin Emefiele, announced that the bank would release re-designed naira notes by December 15, 2022.According to the CBN governor, this was targeted at controlling currency in circulation as well as curb counterfeit currency and ransom payment to kidnappers and terrorists. He noted, “Indeed, the integrity of a local legal tender, the efficiency of its supply and its efficacy in the conduct of monetary policy are some of the hallmarks of a great central bank. “In recent times, however, currency management has faced several daunting challenges that have continued to grow in scale and tsophistication with attendant and unintended consequences for the integrity of both the CBN and the country. More specifically, as at the end of September 2022, available data at the CBN indicate that N2.73tn out of the N3.23tn currency in circulation was outside the vaults of commercial banks across the country, and supposedly held by members of the public. Evidently, currency in circulation has more than doubled since 2015, rising from N1.46tn in December 2015 to N3.23tn as at September 2022. I must say that this is a very worrisome trend that cannot continue to be allowed.”
- Donald writes in via [email protected]
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