CBN affirms old Naira notes will remain legal tender indefinitely, dispels December 2024 deadline

The Central Bank of Nigeria (CBN), on Thursday said it does not intend to discontinue the circulation of the old series of N200, N500 and N1,000 banknotes by December 31, 2024.

The central bank’s clarification came on a day the House of Representatives called on the apex bank to increase issuance of the newer N200, N500 and N1,000 denominations, and commence the phase out of old notes from circulation before the December 31, 2024 deadline for their discontinuation.

The House further urged the apex bank to order commercial banks to immediately stop cash payment to their customers with old N200, N500 and N1,000 notes as well as engage in gradual mopping up of the old notes.

The resolution of the lower chamber, which was moved at plenary by Hon. Afam Ogene, followed the adoption of a motion of urgent national importance on the need for CBN to sensitise Nigerians about the non-legal tender status of old naira notes from January 1, 2025.

Ogene expressed worry that the CBN had not shown any sign of sensitisation or kick-started any awareness programme to remind Nigerians about this important economic policy in order to make them prepare for the deadline of December 31, 2024.

However, the CBN in a statement issued by its acting Director, Corporate Communications Department, Mrs. Sidi-Ali, Hakama, said such claims by the House are “false and calculated to disrupt the country’s payment system”.

For the avoidance of doubt, the CBN maintained that the order of the Supreme Court on Wednesday, November 29, 2023, which granted the prayer of the Attorney-General of the Federation and Minister of Justice to extend the use of old Naira banknotes ad infinitum, remains in force.

Similarly, the CBN’s directive to all its branches to continue to issue and accept all denominations of Nigerian banknotes, old and re-designed, to and from deposit money banks (DMBs) remains in force.

Hakama further pointed out that the central bank’s earlier directive to all its branches to continue to issue and accept all denominations of Nigerian banknotes, old and re-designed, to and from deposit money banks (DMBs) was still in effect.

The Supreme Court had ordered that the old series of N200, N500, and N1,000 banknotes shall continue to be legal tender alongside the redesigned versions.

Accordingly, all banknotes issued by the CBN will continue to remain legal tender indefinitely, the statement added.

Hakama said, “We, therefore, advise members of the public to disregard suggestions that the said series of banknotes will cease to be legal tender on December 31, 2024.

“We urge Nigerians to continue to accept all Naira banknotes (old or redesigned) for their day-to-day transactions and handle them with the utmost care to safeguard and protect their lifecycle.

“Furthermore, the general public is encouraged to embrace alternative modes of payment, e-channels, in order to reduce pressure on the use of physical cash.”

On November 14, 2023, the CBN announced the extension of the legal tender status of the old N200, N500, and N1, 000 denominations beyond the December 31, 2023 deadline – and with no definite time frame for their retirement.

The bank noted that the decision was in line with global best practices and to “forestall a repeat of earlier experiences”.

The central bank stated, “Thus, all banknotes issued by the Central Bank of Nigeria (CBN), in accordance with Section 20(5) of the CBN Act 2007, will continue to remain legal tender, ad infinitum, even beyond the initial December 31, 2023 deadline.

“The Central Bank of Nigeria is working with the relevant authorities to vacate the subsisting court ruling on the same subject.”

The apex bank had introduced the redesign of N200, N500, and N1,000 denominations in October 2022 and various deadlines were set for the old design of the banknotes to be retired.

However, the economic hardship that resulted from the implementation of the currency redesign programme compelled some state governors to sue the central bank.

The apex bank, however, stated that all “CBN branches across the country will continue to issue and accept all denominations of Nigerian banknotes, old and redesigned, to and from deposit money banks (DMBS)”.

“The general public is enjoined to continue to accept all Naira banknotes (old or redesigned) for day-to-day transactions and handle these banknotes with utmost care, to safeguard and protect the lifecycle of the banknotes.

“Also, the general public is encouraged to embrace alternative modes of payment, e-channels, for day-to-day transactions,” the statement added.

Following the Supreme Court ruling of March 3, 2023, the apex bank ordered banks to comply with the ruling of the Supreme Court ordering the old naira notes to remain legal tender and operate simultaneously with the redesigned naira notes till December 31, 2023.

The bank stated that it met with the Bankers’ Committee and directed that the old N200, 500, and N1000 banknotes remain legal tender alongside the redesigned banking notes till December 2023, and consequently, all concerned are directed to conform accordingly.

The clarification by the central bank became necessary in view of the divergent social media misinterpretations and speculations of the validity of the affected naira denominations as the deadline approached.

Meanwhile, Ogene recalled the hardship, frustration, controversy and chaotic situation occasioned by the CBN change of currency in 2023, that affected validity of the old N200, N500 and N1,000 Naira notes at the time that resulted in litigations.

The lawmaker further recalled the current scarcity that led to untold hardship in the nation as a result of the CBN’s inability to supply new versions of the changed currency notes.

He said going by the Supreme Court’s subsequent ruling and order, the N200, N500 and N1,000 notes would cease to be legal tender, medium of exchange for goods and services in Nigeria, and shall also cease to be in circulation by the expiration of the deadline.

Ogene expressed worry that the CBN had not shown any sign of sensitisation or kick-started any awareness programme to remind Nigerians about this important economic policy in order to make them prepare for the deadline of December 31, 2024.

He expressed concern that Nigerians would be plunged into more chaotic situations than what happened in February, 2023, when the old N200, N500 and N1,000 notes would cease to be legal tender and medium of exchange for goods and services as from January 1, 2025.

Ogene argued that the CBN ought to have started public awareness, such as Jingles, Television and Radio announcements, Social Media postings, Flyers, Daily Newspapers and Periodic Magazines publications three months before the deadline.

He lamented that with about two months to the deadline, there was nothing to show that the apex bank was prepared for the exercise.

The lawmaker added that the CBN was still comfortably releasing the old N200, N500 and N1,000 notes mixed with the new N200, N500 and N1,000 notes for business transactions in Nigeria, instead of the gradual mop up of the old notes from circulation or ordering commercial banks to do so by issuing out only the new notes.

The House, therefore, called on the, “Central Bank of Nigeria (CBN) to issue more new N200, N500 and N1,000 notes and begin the gradual withdrawal of the old notes from circulation before the deadline of December 31, 2024.

“Urge the Central Bank of Nigeria (CBN) to order commercial banks to forthwith stop cash payment to their customers with old N200, N500 and N1,000 notes but instead, engage in gradual mopping up of the old notes.

“Urge the Central Bank of Nigeria (CBN) to kick-start awareness programmes for Nigerians to be aware and prepare for the deadline of December 31, 2024.”

The House directed its Committee on Banking Regulations to ensure compliance and report back to the House within 21 days.

Meanwhile, in another development, the House donated the sum of N100 million to victims and families of last week’s petrol tanker explosion, which led to the death of over 170 persons in Jigawa State.

The Speaker of the House, Hon. Tajudeen Abbas, disclosed this on Thursday when he led a delegation from the House to sympathise with the people and government of Jigawa State.

This comes as members of the House from the North-West zone, as well as others from other zones, donated the sum of N100 million to the families of the victims.

The incident occurred at Majiya town in Taura Local Government Area of the state on Tuesday, October 15.

Abbas said, “It is indeed with a deep sense of loss, sadness that members of the House of Representatives are here to commiserate and condole the good people of Jigawa State over the unfortunate incident that happened a few days ago.

“We received the news with great shock and dismay but with that total submission to the Almighty Allah. Whatever happens to a man, we believe is predestined. All we can do as faithful is to pray for the repose of those who passed away.

“Your Excellency, I would like you to know that the House is with you at this period of loss and sorrow; the House is with you in looking for ways and means of preventing future occurrence in Jigawa State and Nigeria as a whole. The House is with you in looking for solutions to other major issues bedevilling our region in particular. We are with you in finding succour to those who are affected by this tragedy.”

The Speaker thereafter, announced the donation of the sum of N100 million from the members of the North-West caucus and other zones to the victims of the tanker explosion.

He added, “The House, in its own little way, has decided to give a symbolic contribution to show our sympathy and empathy to the great people of this state, particularly the victims of this unfortunate incident.

“The House has mandated me and other members here present to announce a donation of N100 million towards the treatment of those who are in the hospital and to give additional support to the families of those who lost their lives.”