Naira redesign: Banks face liquidity crisis

Lagos residents on Tuesday began to accept the old N200, N500 and N1,000 banknotes for transactions following a validation from the Central Bank of Nigeria (CBN) to do so.

The CBN in a statement by its acting Director, Corporate Communications, Mr Isa AbdulMumin, on Monday, directed the commercial banks to comply with the Supreme Court judgement of March 3.

“Accordingly, the CBN met with the Bankers’ Committee and directed that the old N200, N500 and N1,000 banknotes remain a legal tender alongside the redesigned banknotes till December 31.

“Consequently, all concerned are directed to conform accordingly”, the CBN had said in the circular.

A visit to some commercial banks, markets and filling stations in Lagos revealed that traders have started accepting the old naira notes and also giving it as change.

It was, however, observed that while traders and residents of the state had fully complied to transact with the old naira notes, some banks were yet to start dispensing both the old and new naira notes.

Lagos residents were seen in large numbers at the entrance of some of the commercial banks visited around Iyana-ipaja, Ikotun, Ikeja, Oshodi and other areas of the state with a hope to get cash.

However, a bank official, who prefer anonymity, claimed that they do not have both the old and new naira notes in their custody to dispense to customers.

“We do not have money to give our customers, that is why we are not paying cash.

“We are hopeful that we will get money from the CBN following the directive”, the official said.

A bank customer, Mrs Gift Amomo, expressed worry, saying that the cash crunch still persisted, in spite of the CBN’s directive on the recirculation of the old naira notes and willingness of the public to accept it.

“I just entered the bank but was told that there was no cash. Both the old and new Naira notes were not available for us to collect”, said Amono.

A PoS operator at Isolo, Mrs Funmi Gbadamosi, said that she was yet to collect cash from banks to facilitate her business but had started collecting the old notes as directed.

“There is still so many queues at the banks and many of the banks are not yet paying.

“Although, we have started collecting the old naira notes, we are yet to get them easily from the banks”, Gbadamosi said.

A trader at Ipaja Market, Mrs Taiye Aibor, said that both sellers and buyers in the locality had started collecting the old noted since they heard of the CBN’s directive.

“We have started collecting the old naira notes since yesterday evening that we heard of the CBN’s directive, and we have been buying and selling with it”, Aibor said.

In his view, Mr Boniface Arinze, an entrepreneur, urged the CBN to ensure supply of money into the circulation, saying “we are tired of going back and forth.

“I will suggest for us to have access to money, CBN should set up a merger with government agencies like non-interest banks, discount houses, finance companies, among others to ensure banks comply with the order.

”Also, compliance should be seen in dispensing cash; both over the counters and ATMs.

“More so, CBN needs to ensure banks accept the notes in return too”, he said.

A patent drug store owner, Mr. Christian Friday, said if the old notes had not been destroyed as insinuated in some quarters, the apex bank should ensure that the banks comply in totality.

“Is it that CBN didn’t confiscate the notes and they were not also burnt as people say?

“If this was not the case, then why did it take the banks so long to accept this?

“All the same, CBN should make the money available to banks and put strict measures in place to ensure that they pay and also collect it back when customers come to deposit”, he said.

A carpenter, Mr Inyang David, expressed joy over the declaration of the old naira notes as legal tender till December.

He, however, said that he wished the banks would begin to pay the banknotes without delay.

Meanwhile, a visit to some of the markets around Ikotun-Egbe, Liasu-Council and Egbe-Idimu, showed traders are fully complying with the order.

Traders selling goods to customers at exorbitant value before the CBN pronouncement were seen selling at the actual price.

There was a sigh of relief in the market as more people were seen buying and paying with cash, while some were engaging in electronic transfers.

Few PoS operators were seen giving out the old notes to customers at the actual fee of N200 per N10,000 and N100 for N5,000.

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