NESG urges CBN to extend use of old naira notes

The Nigeria Economic Summit Group (NESG) has advised the Central Bank of Nigeria to reconsider prolonging the usage of the old notes side-by-side with the newly redesigned notes.

In its report titled “Naira Redesign Policy: Caught in the Web”, the group also advised the CBN to expedite the printing of new notes, intensify public sensitization and strengthen digital infrastructure.

NESG’s intervention comes against the backdrop of the cash crunch and hardship being faced by Nigerians in recent weeks.

“Due to the hardship households and businesses face, especially in the informal sector, the CBN needs to reconsider prolonging the legal tender usage of the old notes side-by-side with the new notes,” the NESG said.

“This is important to give the CBN the opportunity and time to devise effective ways of getting the new note to the unbanked populace and rural dwellers that constitute a large portion of the informal economy. As such, a gradual phasing out of the old note is advised.”

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The NESG also advised the CBN to streamline distribution channels to ensure efficient delivery of the new notes to commercial banks and other financial institutions.

This it said will help ensure an adequate supply of cash to meet the public’s demand and reduce long queues and other inconveniences.

The group also suggested that the CBN should launch a public sensitisation campaign to educate the public on the need for new notes and the reasons behind the delayed printing process or scarcity of cash.

“This will help prevent negative vested interest narratives and misinformation resulting from an inadequate supply of cash,” it said.

“The campaign should emphasize the objectives and benefits of currency redesign. Also, there should be incentives to promote the use of digital channels, such as a reduction of charges on transactions associated with digital channels.”

Digital Infrastructure

On digital infrastructure, the NESG said there is an urgent need to expand the capacity of the digital financial system to accommodate the mass migration to digital channels.

“This is important to ensure a seamless transition to digital channels as alternatives to cash,” it added.

“The difficulty experienced by people attempting to use digital channels for transactions suggests that payment platforms are not adequately mature to adjust quickly to a cashless economy.”

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Last Thursday, amid tension and reported cases of attacks on banks, President Muhammadu Buhari approved the continued use of the old N200 notes.

However, millions of Nigerians have continued to grapple with hardship amid the cash crunch that has worsened business transactions and stifled trade in the informal economy.