As the December 31 deadline for utilising the outdated N200, N500, and N1000 banknotes draws near, it has been corroborated by emerging reports that a cash scarcity has been seen in Kano and Borno states.
Following a decision from the Supreme Court, the Central Bank of Nigeria (CBN) said in March that the old banknotes will continue to be valid alongside the newly designed ones until December 31.
In October of the previous year, former governor of the CBN, Godwin Emefiele, disclosed plans to redesign the N200, N500, and N1000 notes. He advised residents to deposit their old notes by January 31, 2023, as they would no longer be regarded as legal money after that day.
This resulted in a widespread cash shortage in February, which put residents through hardships and even sparked bank assaults and riots in some towns around the country.
The previous N200, N500, and N1000 notes’ legal tender status was, however, extended by the Supreme Court on March 3 until December 31.
According to Legit NG, businesses in the states of Kano and Borno are having difficulties obtaining enough funding two months ahead of the deadline.
An anonymous CBN representative said that there were no intentions to phase out the old notes.
Abdullahi Usman, a point-of-sale (POS) operator in Kano, mentioned that banks were only permitting a certain amount of daily withdrawals for both individuals and corporate entities, which forced him to get cash from market transactions.
He said: “As a POS operator, I can’t give more than N20,000 to individuals because most banks only allow us to have N40,000 to N50,000 daily. I learnt that only owners of corporate accounts can get N150,000 to N200,000.
“If you go around town, you will find out that most of the POS centres now have less cash compared to some weeks ago”
Another point-of-sale operator, Bello Shehu, has chosen to get cash from petrol stations rather than banks as the latter frequently require larger amounts of cash for customers.
“I get my cash from fuel stations because the cash we get from the banks nowadays is limited and can’t cater for our customers’ demands”, he stated.
A shopkeeper in Hotoro, Kano’s Nassarawa Local Government Area, named Muhammad Gambo, recently complained about not being able to get cash out of ATMs.
Similarly, a public servant with the Kano State Government described how he tried six different ATMs without success to withdraw his October pay before turning to POS, where he was only able to get half of what he required.
News About Nigeria gathered that residents, merchants, and banks in Maiduguri, Borno State, are feeling the effects of the cash crisis acutely since most transactions can only be completed with a certain amount of cash.
Due to a severe cash scarcity, most transactions in Maiduguri, Borno State, must be completed online by locals, traders, and banks.
Customers were subject to cash withdrawal limitations at ATMs and POS terminals, and there was a shortage of cash.
A Maiduguri bank employee said that since naira notes were in short supply, his bank had imposed a N20,000 limit on client withdrawals.
He further mentioned that clients were no longer making deposits at the bank.
He stated, “Surprisingly, you will give customers cash every day, but no cash deposit is coming. We learnt that some agents mop up cash from traders and filling stations in town.”
According to Bala Gidado, a Bureau de Change agent along the popular Sheraton Road in Wuse Zone 4, Abuja, there has been a shortage of Nigerian naira in the last few days.
Gidado said: “Banks have started mopping up cash, and it could be because of the December deadline for the expiration of the old notes.
“I went to the bank today to get cash; I couldn’t get what I wanted. Naira is now very scarce, and we don’t understand what is happening again.”
Ibrahim Hayatu, another person working in the Bureau de Change, noted that although the naira scarcity started last week, it has gotten worse this week.
“The issue of naira scarcity started last week, but this week, we can’t see it even if you go to the bank; it’s a problem. Today, I had to ask my colleagues before I got N500,000,” he noted.