- The Central Bank of Nigeria said it has plans to withdraw dirty notes from circulation
- The apex bank noted that a large number of the N7.9 trillion pieces of naira notes in circulation were bad
- CBN governor, Godwin Emefiele is expected to launch a policy to address this problem
The Central Bank of Nigeria has recognised the fact that a large portion of the N7.9 trillion pieces of naira notes in circulation are dirty, mutilated, unfit for Automated Teller Machines and will be withdrawn.
The Nation reports that the apex bank noted this in a statement by its deputy governor of operations, Folashodun Shonubi and director of currency operations department. Pricilla Eleje.
The officials said the bank has the obligation of providing clean notes to the people.
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CBN Governor Godwin Emefiele is “due in Lagos tomorrow to launch “The clean note policy and banknote fitness guidelines” as the apex bank said this was a step to address this issue.
“The clean note policy provides a uniform standard for the circulation of only clean and fit banknotes; while the banknote fitness guidelines provide the industry with clear and acceptable criteria for determining the quality of notes in circulation.”
“The CBN cannot achieve these objectives without the collaboration of deposit money banks(DMBs), merchant banks, microfinance banks, government agencies, Cash-in- Transit ( CIT), Cash Processing Companies (CPCs), Market Associations, merchants/retailers, chambers of commerce and industry, security agencies, currency Management equipment manufacturers , bank customers and the general public.”
“In view of technological advances, the CBN, like other central banks has introduced various forms of electronic payment systems for effective and efficient settlement of transactions and to reduce the volume of cash usage with its attendant cost implications.
“Despite the prevalence of other forms of payment, cash remains ‘king’ in our day to day economic transactions. As such, people still prefer to use cash in making payments especially where there are no digital payment platforms.
“Consequently, demand for cash continues to grow despite technological advances. Thus, the volume of currency in circulation as at the end of 2012 rose significantly by 10.34 per cent to 7,914.70 billion pieces, as at half year of 2018. A large proportion of the notes in circulation were dirty, mutilated, not fit for ATMs and over-the-counter payments.
“To overcome the challenge, the CBN increases the supply of clean notes and withdraws the soiled and mutilated notes from circulation.
“In addition, the bank introduces from time to time a number of currency management initiatives to ensure that the production, issuance of new notes, processing by third service providers as well as recirculation by the deposit money banks (DMBs) conform to the predetermined standards.
“To ensure that the banknotes in circulation are clean and of high quality, the bank hereby issues the clean note policy. The clean note policy enunciated therefore by the bank, entails a spectrum of diverse currency management activities geared towards the efficient circulation of premium quality banknotes and withdrawal of unfit/soiled banknotes to guarantee public confidence and usage of the naira banknotes as a medium of exchange.”
Meanwhile, the general-manager of Labana Rice Mills, an indigenous rice milling farm in Kebbi State, Abdullahi Zuru decried the high increase in rice smuggling in Nigeria.
Zuru while speaking with journalists in Birnin Kebbi said the increase in rice smuggling is a threat to the Anchor Borrowers Programme of the Central Bank of Nigeria (CBN) and local production of rice.
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