People & Money

Naira Redesign: Cash Remains Scarce After Supreme Court Ruling

Three days after the Supreme Court’s ruling on the old Naira notes, no respite is still in view. On Monday, people were seen across different banks as early as 7 am queueing to get cash across the counter as most ATMs still are not dispensing.

Recollect that the Supreme Court, on Friday, the 3rd of March, declared that the old N1,000, N500, and N200 banknotes should continue circulating until the 31st of December. Justice John Okoro, leader of the seven-man panel, issued the judgment in a lawsuit filed by the Governors of Kaduna, Kogi, and Zamfara against the Federal Government and the CBN.

As early as 9 am on Monday, a swarm of people were observed at bank branches throughout Nigeria. However, many of these banks were now giving the old and the new Naira notes. For example, in Ibadan, banks were observed giving old N1000 notes to their customers. Although some banks, such as FCMB in Agbowo, Ibadan, dispensed new Naira notes, they only provided a maximum of N5000 in new notes.

Also Read: Decisions have consequences

However, the situation still needs to improve as most banks still report a cash supply shortage. In Abuja, most Access Bank branches reported a no-cash situation as the banks only received customers with customer service issues. The situation remained broadly similar across various cities in the country, ranging from Lokoja to Ilorin to Ado Ekiti.

Coupled with the cash scarcity, many Nigerians have struggled with mobile banking apps and the various technical difficulties associated with instant payment. Since Friday last week, GTBank’s 737 USSD service has been inoperable to provide an instance. Most Nigerians, particularly in the informal sector, have turned to Fintech apps like Opay, Palmpay, Kuda Bank, and other payment service providers to cope with the malfunctions of mobile banking apps.

Also Read: Will Economic Collapse Precede Political Transition in Nigeria?

Since the start of 2023, Nigerians have been battling a cash scarcity situation as the CBN redesigned the N1000, N500, and N200 notes. The shortage of cash has significantly disrupted the informal sector of the economy. The problem is expected to severely impact Nigeria’s GDP economic indicators in the first quarter of 2023. Nevertheless, the policy has been effective in curbing inflation and hindering the vote-buying process during the Presidential elections on the 25th of February.

David Olujinmi

David Olujinmi studies Engineering but his true passion is research and analysis. He writes about finance, particularly the capital market, investment banking, and asset management. More »

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