President Muhammadu Buhari has sympathised with Nigerians over the difficulties being experienced as regards the implementation of the naira redesign policy.
He reiterated that the policy is aimed at boosting the economy and tightening the loopholes associated with money laundering, adding that ahead of the 25 February elections, “the new monetary policy has also contributed immensely to the minimisation of the influence of money in politics”.
Mr Buhari stated this Thursday during a national broadcast addressing the challenges of the currency swap and the state of the nation.
He also revealed that since the commencement of the programme,” about N2.1 trillion out of the banknotes previously held outside the banking system has been successfully retrieved”.
Since the introduction of the new policy, Nigerians across the country have faced difficulties in accessing the redesigned N200, N500, and N1000 Nigerian banknotes, while the old notes were initially ordered to cease to be legal tender on 31 January.
“In appreciation of the systemic and human difficulties encountered during implementation and in response to the appeal of all citizens, an extension of 10 days was authorised till 10 February for the completion of the process.
“All these activities are being carried out within the ambit of the Constitution, the relevant law under the CBN Act 2007 and in line with global best practices,” Mr Buhari noted.
Points underpinning policy decision
Speaking further, Mr Buhari explained that there are a few issues underpinning the policy decision in the country, which include the need to restore the statutory ability of the CBN to keep firm control over the money in circulation.
He revealed that in 2015 when his administration commenced its first term, currency-in-circulation was only N1.4 trillion, while the proportion of currency outside banks grew from 78 per cent in 2015 to 85 per cent in 2022.
As of October 2022, he said “the currency in circulation had risen to N3.23 trillion; out of which only N500 billion was within the banking system while N2.7 trillion remained permanently outside the system; thereby distorting the financial policy and efficient management of inflation.”
He said: “The huge volume of banknotes outside the banking system has proven to be practically unavailable for economic activities and by implication, retard the attainment of potential economic growth.
“Economic growth projections make it imperative for government to aim at expanding financial inclusion in the country by reducing the number of the unbanked population; and given the prevailing security situation across the country, which keeps improving, it also becomes compelling for government to deepen its continuing support for security agencies to successfully combat banditry and ransom-taking in Nigeria.”
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