Large withdrawals causing cash scarcity in some locations — CBN

The Central Bank of Nigeria, CBN, on Thursday, assured Nigerians of sufficient stock of currency notes for economic activities in the country. Daily Trust had on Wednesday reported that as the December 31 deadline for the use of the old N200, N500 and N1000 banknotes approaches, scarcity of cash has hit Kano and Borno states […]

The Central Bank of Nigeria, CBN, on Thursday, assured Nigerians of sufficient stock of currency notes for economic activities in the country.

Daily Trust had on Wednesday reported that as the December 31 deadline for the use of the old N200, N500 and N1000 banknotes approaches, scarcity of cash has hit Kano and Borno states as well as some cities.

The apex bank in a statement shared on its X (formerly Twitter) handle, @cenbank, noted that the seeming cash scarcity in some locations is due largely to high volume withdrawals from the CBN branches by Deposit Money Banks (DMBs) and panic withdrawals by customers from the Automated Teller Machines, ATMs

“While we note the concerns of Nigerians on the availability of cash for financial transactions, we wish to assure the public that there is sufficient stock of currency notes for economic activities in the country. The branches of the CBN across the country are also working to ensure the seamless circulation of cash in their respective states of operation,” noted the statement signed by its Director, Corporate Communications, Dr Isa AbdulMumin.

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While urging Nigerians to embrace alternative modes of payment, which would reduce pressure on using physical cash, the bank advised the public to guard against panic withdrawals as there is sufficient stock to facilitate economic activities.

However, Daily Trust observed that the statement was silent on the December 31 deadline of the old notes as ordered by the Supreme Court of Nigeria in March.

The former governor of the CBN, Godwin Emefiele, had, in October last year, unveiled plans to redesign the N200, N500 and N1,000 notes and advised citizens to deposit their old notes before January 31, 2023, as they would cease to be legal tender thereafter.

This resulted in a cash crunch nationwide in February, leaving citizens stranded. The situation led to protests and attacks on banks in some cities across the country.

The Supreme Court later, on March 3, extended the legal tender status of the old N200, N500, and N1,000 notes to December 31.