The Central Bank of Nigeria (CBN) has disclosed that the move to redesign the naira notes was necessitated due to cases of hoarding, shortage of clean notes, and counterfeiting.

The CBN governor Mr. Emefiele stated that the current banknotes were easy to counterfeit, noting that the CBN has recorded significantly higher rates of counterfeiting especially with the higher denominations, N500 and N1,000 banknotes.

He added that the country was facing a shortage of clean notes which had a negative effect on the perception of the CBN.

He also said that the hoarding of banknotes by members of the public had resulted in over 80 percent of the currency in circulation being outside the vaults of commercial banks.

The Naira notes that will be redesigned and reissued are that of the higher denominations which are N100, N200, N500, and N1,000, exempting the lower denominations.

The CBN Governor, Godwin Emefiele, who announced the CBN’s decision said, “In recent times currency management has faced several daunting challenges that have continued to grow in scale and sophistication with attendant and unintended consequences for the integrity of both the CBN and the country.”

“As at the end of September 2022 available data at the CBN indicate that N2.7 trillion out of N3.23 trillion currency in circulation was outside the vaults of commercial banks across the country and supposedly held by members of the public.”

“Evidently, currency in circulation has more than doubled since 2015, rising from N1.46 trillion in December 2015 to N3.23 trillion as of September 2022. I must say, that this is a worrisome trend that cannot continue to be allowed.”

The CBN has therefore urged all bank customers to begin to pay into their accounts the current naira notes to enable them to withdraw the newly redesigned note which will be in circulation starting from the 15th of December this year.

However, the CBN stated that the old notes will still be accepted, noting that it remains a valid legal tender that can be used for payment of goods and services, until its expiry date on the 31st of January 2023.

Meanwhile, the Economic and Financial Crimes Commission EFCC has commended the CBN move, stating that it was “a well-considered and timely response”.

Investors King understands that the commission has already disclosed its plan to move against currency hoarders who maybe forced to bring out their huge stash of cash into the banks.