The redesign of banknotes planned by the Central Bank of Nigeria (CBN) falls within the jurisdiction and constitutional mandate of the bank. It is part of the bank’s currency management function, aimed at protecting the integrity, value and respect of the naira. It can also go a long way in improving financial stability and significantly reducing the risk of naira counterfeiting.
It can also help the government to actualize the cashless policy in the country and help track, identify, apprehend and arrest financial criminals who hoard huge sums of money for illicit and illegitimate purposes. It can also allow the nation to reduce the overmonetization of elections to a strict minimum.
This overhaul is also relevant and long overdue as stated by the CBN Governor in his press release in this regard. The governor said any central bank should redesign, produce and release new legal tender every five to eight years in line with global best practices. The naira has not been redrawn for the past twenty years. The policy is therefore appropriate if not for the moment as well as the hard and severe economic realities of the country.
However, information about the policy is scarce and inadequate, especially for the rural population, which can lead to unwarranted rumors that can reduce the integrity of the policy. It is necessary to enlighten, inform and educate the population to make them aware of exercise. There is also a need to put in place adequate facilities that can cater to the needs of the masses, especially those who are not catered for in the banking system. Therefore, the CBN should also consider giving sufficient and timely publicity to ensure the process runs smoothly, effectively and efficiently.
Apart from the global economic collapse attributed mainly to the COVID-19 pandemic, the Russian-Ukrainian war and regional instabilities, the Nigerian masses are under severe economic pressures due to insecurity, floods, relentless depreciation of the naira and the weak performance of the economy. . They now urgently need remedial and ameliorative measures to help them cope with adverse economic conditions.
Since the majority of the Nigerian population lives in rural areas where there is a palpable shortage of financial institutions, appropriate measures must be put in place, considering the timing, process and procedure for changing the note. naira; whose failure can further economically emasculate the already weak common man.
The Federal Government and the CBN must partner with the Ministry of Information, the Media and the National Guidance Agency to reach every nook and cranny of Nigeria and educate the masses on how to change their old tickets to naira. Religious leaders, religious organizations, community leaders and traditional councils should be involved in disseminating information to the masses, especially in local dialects so that they can better understand.
In addition, the CBN, in collaboration and cooperation with relevant financial institutions such as commercial banks, should make adequate arrangements to take care of the rural population in this policy. Properly regulated exchange points should be provided, secured, monitored and protected to enable people in rural areas to change their money without difficulty. Security agencies should also be engaged to provide adequate security at these points to avoid, dispel and eliminate fear of any possible attack on both staff and customers.
These measures can improve the effectiveness, efficiency and integrity of the program. They can also ensure the inclusiveness of the process and limit negative economic implications on the common man.
Usman Aliyu Elnafaty writes from Bauchi