The Senate has urged the Central Bank of Nigeria (CBN) to urgently extend the date of withdrawal of old currency from circulation from 31st January to June 31st 2023.
This resolution of the Senate followed a motion sponsored at its plenary on Wednesday by a former Senate Leader, Senator Ali Ndume (APC, Borno South), titled: “Urgent Need to extend the Withdrawal of Old Currency from Circulation.”
Presenting the motion, Senator Ndume noted that the timing of the policy was wrong, adding that since the beginning of the implementation of the cash withdrawal limit, the new notes are not in circulation even in the cities, not to talk of the villages.
“Many Nigerian banks, on Thursday 15th December 2022, open their vault to customers and depositors to exchange their old naira notes for the newly redesigned currency, which has a stipulated deadline of January 31, 2023;
Aware that some Nigerians are already envisaging rush and long queues in the banking hall across the country as a result of people trying to get access to the new naira note, which was unveiled last month by President Muhammadu Buhari at a brief ceremony at the State House, Abuja;
Aware also that the old notes are expected to be in circulation alongside the new ones until January 31, 2023, when the old notes are expected to be phased out, it is expected that many Nigerian businesses would start to reject the old notes as soon as the banks start paying out the redesigned notes to customers;
Observes that access to the new notes may be compounded by the recent circular by the CBN, which limit the amount of cash individuals and corporate entities could withdraw within a certain period of time. For instance, the CBN said individuals could only withdraw N100, 000 per week while corporate could only have access to N500, 000 per week through over-the-counter (OTC) transactions;
Observes that access to large quantities of cash above the limit would attract processing fees of 5% and 10% for individuals and corporate entities, respectively. Large withdrawals are also subjected to scrutiny by the regulator to determine the importance and usage of such cash,” Ndume stated.
The lawmaker is convinced that if the withdrawal of old notes from circulation is not extended beyond 31st January 2023, many Nigerians will be thrown into hardship, adding that it would help to avoid a repeat of the 1984 experience of withdrawal of old notes.” Other Senators supported the motion, noting that the timing was not right.
Accordingly, the Senate adopted the single recommendation of the motion, urging the apex bank to pursue an extension.