As the deadline set by the Central Bank of Nigeria (CBN) for the use of the old N200, N500, and N1000 banknotes approaches, two states in Nigeria, Kano and Borno, are grappling with a scarcity of Naira notes.
The CBN had previously announced that the old Naira notes would remain legal tender until December 31, 2023, in accordance with a Supreme Court order. Former CBN governor, Godwin Emefiele, had unveiled plans to redesign the N200, N500, and N1,000 notes, urging citizens to deposit their old notes before January 31, 2023, as they would no longer be accepted as legal tender. This had led to protests and attacks on banks in various cities across the country.
However, with only a few weeks left before the CBN’s deadline, business communities in Kano and Borno states are expressing concerns about the resurfacing of Naira scarcity.
A CBN official who reportedly clarified this development with Daily Trust said, there is no plan to “phase out the old notes.” Despite this, a Point of Sales (PoS) operator in Kano, Abdullahi Usman, revealed that banks were limiting daily withdrawals to between N40,000 and N50,000 for individuals and N150,000 to N200,000 for corporate entities. He mentioned that most of his cash supply now comes from markets due to the limited cash available through banks. Additionally, he expressed the difficulty in providing more than N20,000 to individuals because of these withdrawal limits.
Bello Shehu, another PoS operator, has resorted to obtaining cash from fuel stations instead of banks, as banks often do not have enough cash to meet customers’ demands. Many people have reportedly deposited their money in banks to avoid issues after December 31, in response to the approaching CBN deadline.
Despite the absence of long queues at bank ATMs, numerous ATMs were found to not be dispensing cash. This shortage has left individuals and business owners struggling to access the cash they need for daily transactions. A shop owner in Hotoro, Kano, Muhammed Gambo, and a Kano State Government civil servant both shared their experiences of difficulty in accessing cash through ATMs. Consequently, individuals are increasingly turning to PoS operators to obtain the funds they require for their financial transactions.