The ruling by the Supreme Court on the use of the old naira notes alongside the new ones has not done much to allay fears in the minds of Nigerians or ameliorate the excruciating hardship being experienced across the nation over scarcity of the currency. As the situation worsens by the day, several Nigerians are left frustrated over their inability to get the cash (naira) requirements that they need for their daily transactions.
It is worrisome that months after the obnoxious policy of redesigning the currency notes that brought with it unimaginable pains and suffering to Nigerians, the financial authorities are mindlessly, in our view, embarking on another policy that is similarly creating artificial scarcity of the nation’s legal tender. This is in the midst grinding efforts by Nigerians to survive just as prices surge and deepening poverty in the process.
A statement by the Central Bank of Nigeria (CBN) that there are enough naira notes in circulation to meet cash needs has not helped in any way to abate the situation plaguing Nigerians especially as there are limits to cash withdrawals that has led to exponential increase in charges by service providers such as points of sale (POS).
The CBN’s Acting Director of Corporate Communications, Mrs Hakama Sidi Ali, in that statement revealed that naira notes in circulation had increased from N1 trillion in February to N3.4 trillion in December. According to her, there is sufficient cash in circulation, but, however, blamed the scarcity on the hoarding of naira notes by some persons due to the challenges they faced during the naira redesign policy of the previous administration of Muhammadu Buhari.
We recall that in October 2022, the former Governor of the Central Bank of Nigeria (CBN), Mr Godwin Emefiele, announced that the highest denominations of the Naira, (N200, N500 and N1000 notes) would be redesigned, giving a deadline of 31 January 2023 for all old notes to be deposited in banks in exchange for new ones.
The CBN, at that time, claimed that the new notes would help curb corruption and currency fraud, tackle the growing menace of kidnapping for ransom, lower inflation and address the problem of having too much money in circulation. Sadly, in our opinion, the implementation of that policy precipitated enormous challenges economic hardship, agony, humiliation, uprising and death of many Nigerians.
A report by the Centre for the Promotion of Private Enterprise (CPPE), claims that Nigeria lost N20 trillion to the ill – timed naira policy from which Nigeria’s economy is yet to recover. The present case is attributed to the hoarding of the naira by some persons due to challenges experienced during the naira redesign project.
Presently, naira scarcity has hit major cities across the country as several Automated Teller Machines (ATMs) stopped dispensing cash and commercial banks introduced limits on withdrawals. PoS operators have increased their charges now because of the current cash scarcity, with customers paying N800 for N20,000 which was for N400 before now.
As a newspaper, we thought that by now, the naira scarcity would be a thing of the past. But it is rather disheartening that this is happening again as Christmas and New Year festivities approach. With Nigerians’ inability to carry out financial transactions, a lot of their daily activities are being disrupted, with their basic needs unmet.
It is unfortunate that with inflation spiraling at its highest rate in 18 years, hitting 27.3 percent in October this year, food inflation at 31.5 percent and Nigerians struggling to overcome the galloping cost of living crisis, naira scarcity frustration is compounding their woes.
In our considered opinion, Nigerians are currently overstressed and it is inappropriate for the government to add more burden on the people no matter the advisability of the policy thrust. We note that with the pump price of premium motor spirit (PMS) changing without warning to the public and electricity supply has remained erratic, adding Naira scarcity to the mix is inhumane, to say the least.
Though CBN Governor Yemi Cardoso, said the apex bank is monitoring the situation and has released sufficient cash to its branches nationwide for onward distribution to Deposit Money Banks, we insist that he walks the talk to ensure compliance.
While we call on the federal government to urgently address the cash shortages before the situation worsens, there’s no better time than now for the visibility of the National Orientation Agency (NOA) to embark on grassroots mobilisation and sensitisation to douse tension and fears and dispel panic over the situation.
Meanwhile, even as we encourage the public to continue to embrace alternative modes of payment, especially e-channels, to reduce the pressure on cash, it must be understood that the Nigerian economy is hugely cash-based. This, in itself, is enough to dictate any policy that is capable of tampering with the distribution of cash and the processes thereof.
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