Commercial banks in different parts of the country on Monday resumed issuance of the old N500 and N1000 notes to customers over the counter and through their Automated Teller Machines (ATM).
The move comes against the backdrop of the Supreme Court ruling on the naira redesign policy of the Central Bank of Nigeria (CBN) which compelled banks to issue the old notes to Nigerians.
On Friday, the Supreme Court ruled that the Central Bank of Nigeria (CBN) must extend the use of old banknotes until 31 December due to the negative impact of the policy. A seven-member panel of the court, led by John Okoro, unanimously ordered the CBN to continue receiving the old notes from Nigerian citizens.
The court found that President Muhammadu Buhari’s directive to the CBN on the withdrawal of old notes and redesign of new banknotes without proper consultation was invalid.
CBN last December introduced new N200, N500 and N1,000 notes by withdrawing the old notes from circulation. The policy caused widespread chaos throughout the country, resulting in protests in various regions as Nigerians faced challenges in their efforts to do business and access cash for daily transactions.
Since the Supreme Court ruling on Friday, the CBN and the Nigerian government have not reacted to the new development. Multiple calls and text messages sent to the presidential spokesperson, Garba Shehu, and the acting spokesperson of the CBN, AbdulMunin Isa, were not responded to as of press time Tuesday night.
Amid the uncertainty, banks and business owners continue to express worry about the silence of the apex bank and the use of the old notes as legal tender.
On Tuesday, PREMIUM TIMES gathered that some commercial banks in Nigeria’s capital city, Abuja, refused to pay their customers the old notes in anticipation of the CBN’s directive on the matter. However, other banks in Lagos and the FCT paid their customers the old naira notes.
A bank official at Union bank who requested anonymity as he was not authorised to speak on the matter told this newspaper that they are just waiting to hear from CBN.
“Since the ruling, CBN has not supplied us with money and we don’t have the old notes.
“If they give us the old notes next time they supply us, then automatically we will dispense them, but for now, we are not sure of anything,” he said.
On Tuesday, a PREMIUM TIMES’ reporter found that the Guaranty Trust Bank branches in Garki are not dispensing the old notes. However, Access bank and Sterling bank in the Central Area of Abuja dispensed the old N500 and N1000 notes to customers.
One of the tellers at the Access Bank branch said they still have the old notes in their vault and they are yet to be supplied with the new notes.
At the Guaranty Trust Bank (GTB) branch in Wuse market, an official of the bank who refused to be named spoke to this newspaper saying “the Supreme Court had given the order for collection but we are yet to get a clear directive from the CBN.”
Another official at the First Bank branch around the Wuse market assured customers with old naira notes to generate codes for deposits. “We are yet to start giving out the old note to our customers because we don’t even have the old naira note and we are waiting for the CBN directives,” the staff added.
At the Access Bank branch in Wuse, an official said: “If you enter inside the bank and ask customer care, they will also tell you that the bank is waiting for CBN to talk before they start issuing the old naira note.”
He confirmed that some banks are already dispensing the old notes but they are yet to receive the authorisation to do the same.
At the Wema bank branch in Wuse market, an officer at the bank said Supreme Court had given the order for the note to be a legal tender “but the CBN has not issued an official statement on the issue so we are patiently waiting for their directives.”
Several banks that visited the Federal Housing Authority (FHA) axis of Lugbe in Abuja were not dispensing cash on Tuesday.
At Fidelity, frustrated bank customers were seen loitering on the premises of the bank to see if anything would change.
At the bank counter, officials who declined to have their names in print as they were not authorized to speak for the bank told our reporter that the branch doesn’t have cash.
“No cash and no network currently. We don’t know when we would have cash at this branch. Even if you come tomorrow I can’t guarantee you that we would have the cash to dispense,” an official told PREMIUM TIMES.
Asked if they would begin the implementation of the Supreme Court ruling on old notes, the bank official said they have not received any updates from the bank’s regional and head offices regarding the court order.
At a Polaris bank branch, customers of the bank said the bank dispensed the old N200 notes to its customers today but that many customers could not process cash withdrawals because the cash was not sufficient.
During a visit to one of the UBA branches at the FHA area in Lugb, customers were seen struggling to enter the banking hall to lodge complaints.
**Insert picture of people struggling to enter the banking hall in Lugbe UBA **
In the banking hall, officials were seen attending to customers who came to process electronic transfers. But when asked if cash transactions could be processed over the counter, the bank official simply said “No cash”.
The situation was the same at the Wema bank branch at the Sector F axis in Lugbe.
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Across all the banks visited, PREMIUM TIMES observed that ATMs were deserted due to a cash crunch. Customers were seen loitering around the ATM terminals and lamenting the hardship they have faced due to the cash crisis.
(Insert a picture showing stranded customers in the banking hall)
On Tuesday, a PREMIUM TIMES’ reporter who visited a Guaranty Trust Bank Branch in Ijaiye Road, Ogba, Lagos, found that the bank had closed to customers as of 2:30 p.m.
PREMIUM TIMES learned a good number of customers rejected old naira notes issued to them over the counter earlier in the day, while none of the cash machines was loaded with money.
A branch of First City Monument Bank in the same neighbourhood was open to customers, the majority of whom hung around within the banking hall, waiting to be paid in old notes. The two automated teller machines (ATMs) of the branch stood empty.
Just beside it, an Ecobank branch had closed for the day around 2:44 p.m. A guard on duty said the branch now closes earlier by 2 p.m., adding that customers are refusing to accept old naira bills.
The cash machines were not stuffed with money as of the time of the visit.
An Access Bank branch some six hundred meters away shut its doors around 3 pm with none of the ATMs working. Old naira notes were available for customers’ withdrawals inside the banking hall.
A Keystone Bank branch and a Stanbic IBTC Bank branch nearby were not open to customers at about the same time and none of the ATMs was working.
At a First Bank branch, Ogba/Ijaiye Road, Lagos, none of the cash machines were dispensing cash. A staff of the bank told PREMIUM TIMES the branch is currently upgrading its system and is not giving out cash to customers.
In Ibadan, the Oyo State capital, residents told PREMIUM TIMES that some commercial banks started dispensing the old notes to customers on Monday. “The notes are not sufficient and we don’t have any directive yet from the CBN,” said an official of a new generation bank who does not want to have his name in print.
On Tuesday, in the midst of poor operations by commercial banks, many Nigerians who queued up for hours to get the old banknotes lamented the ripple effect of the cash crunch on their daily businesses.
Grace Ominiyi, a cloth vendor at Karmu market in Abuja, complained about her condition and how she has been unable to spend the old notes she received at the weekend.
“We heard about the court ruling on TV Friday night, so it was not a problem receiving it from my customers on Saturday and even from church customers on Sunday.
“I came to the market today (Monday) and I noticed no one is collecting the old note, and I cannot go and deposit it in the bank now,” she said.
Ms Ominiyi is not the only frustrated trader battling with low patronage and the adverse effect of the naira note policy.
PREMIUM TIMES’ survey Tuesday revealed that businesses and traders recorded low patronage as Nigerians battle with the cash crunch.
Consumers are more cautious with their spending due to the limited availability of cash, which has led to a decline in sales for many businesses, especially small and medium-sized enterprises (SMEs) that rely heavily on consumer spending to stay afloat.
Akpotcha Bernice, a food vendor at the market, told PREMIUM TIMES that sales have been poor.
“I don’t sell like before again, even when I adjust and ask customers to transfer to my daughter’s account, some get discouraged on hearing that they have to pay N100 extra for charges,” she said.
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