The Governor of the Central Bank of Nigeria (CBN) Mr Godwin Emefiele spoke to State House correspondents on the redesigned banknotes unveiled by President Muhammadu Buhari. Our correspondent, ABDULLAHI M. GULLOMA, presents an abridged version of the interactive sessions.
What informed the decision of the Central Bank of Nigeria to redesign some banknotes at this critical time?
The practice worldwide is that currencies should be redesigned or replaced or reissued every five to eight years. But for Nigeria, we have not had the opportunity of redesigning and reissuing currency in the last almost 19 years.
The Central Bank of Nigeria, by law, has the mandate to reissue and redesign currency for the country and its people, every five to eight years. And I want to hope that after the event of today, the Central Bank of Nigeria can just take it as part of its programmes to see to it that every five to eight years, the currencies are designed or reissued because mainly, the Central Bank of Nigeria should be able to have control full of the size of currency in circulation. After all, it has implications for monetary policy management in the country. There is no need for anybody to think that this programme is targeted at anyone. As you heard the President speak in the Council Chambers, he said the discussion to redesign and reissue this currency started earlier in the year.
We took painstaking efforts in looking at the pros and cons and the reasons when and why it should be done. And the President in his wisdom, decided that yes, it must be done.
In the past, I have to confess that attempts by the Central Bank of Nigeria to redesign our currencies have been resisted. And that is the reason I also said in my speech that it is only a President of the esteem and statute of President Muhammadu Buhari that could have done this. And I want to seize this opportunity to appeal to members of the public that there is no need for any insinuations, giving the impression that this is targeted at any individual there is no attempt at that. We’re doing our work and we would continue to do our work.
The EFCC chairman told us that some governors are trying to frustrate this new policy and we also read a particular presidential candidate withdrew N40 million to share in a community. What are your plans to ensure this policy succeed?
As I said earlier, our policy of redesign and reissue is not targeted at anyone. But of course, we have the laws and we will indeed be more intense in ensuring that the provisions of the law and the CBN regulations about the size and volume of currency that people can carry or hold or withdraw. We will insist that this is done going forward.
In other countries, say in the US, if you want to withdraw $10,000 from the counter, you will be interrogated, you will fill out numerous forms, and they will even track the use of that $10,000 cash that you are withdrawing. If you want to withdraw £10,000 from the counter, they will refuse and if you insist then you will fill out forms. The problem we have had in the past is that we say this is a cash economy. No economy is inbuilt thinking that it has to be a cash economy.
The world has moved away from predominantly cash to a cashless economy. And I think Nigeria and the Central Bank of Nigeria are prepared at this time to move towards a cashless economy. And that is the reason why with the reissue of these banknotes, we will insist that cashless would be nationwide. We will restrict the volume of cash that people can withdraw over the counter. If you need to withdraw a large volume of cash, you will fill out uncountable forms. We will take your data, whether it is your BVN, or your NIN so that enforcement agencies like EFCC or ICPC can follow you and be sure that you are taking that money for a good purpose.
We have to work as a country, Nigeria is the biggest country in both population and economy in Africa and we have to ensure that we do things the right way which also positions us as the leader in Africa and one of the leading countries in the world. We must do things right and I think it would start today.
Certain groups have called for an extension of this policy implementation given that the time frame is too short. What will you tell them?
Well, it is in their minds when they said the time is too short. We will not go with them to that destination. What we are saying is this; we announced this programme on October 26, 2022. And we have said that from today, this currency that is reissued will be legal tender in Nigeria and all over the world it’s going to be accepted. So, between October 26, 2022, and January 31, 2023, is more than 100 days. Like the President has said, if you have the cash it should not take you more than 100 days to be able to deposit it in your bank and take whatever little quantity you need for use. We have made adequate arrangements; the banks have been told that they will keep their currency processing centre open from Mondays to Saturdays even to late hours every day. We have also offered that the Central Bank of Nigeria currency processing centres across all the 36 states of the federation including FCT will be available to process cash from Mondays to Saturdays. It might interest us to know that daily, the Deputy Governor (Operations) calls the banks and the CBN currency processing centres to find out if there are queues or if there is some form of congestion about people depositing cash. There is none. We have also made available through our agency banking arrangement platforms for people in the villages can use POS and their stores to receive and pay cash.
In 2018, we had 86,000 touch points of agency banking, and as of October, the number of those who have financial system touch points is 1.4 million. So, there is no local government that you don’t have agent bankers that can do this on our behalf. So, it’s as good as saying we have over one million points or branches of banks where you can deposit or take your cash to. There is no reason for anyone to say he cannot access cash or be able to pay his take into a bank. So, we are not going to go with those people on their journey to say that the time frame is short. In our wisdom and the wisdom of the President, the time frame is not short. We have more than ample time to do so.
How do you intend to address the issue of counterfeit banknotes in circulation with the resigned ones?
Let me tell you, these new banknotes cannot be counterfeited because of the security features in them; nobody can counterfeit them. You could only find will be people making a photocopy of these banknotes. If you follow due process to check the authenticity of a currency and take them through the UV light, you will find that this currency cannot be counterfeited. The best you will find is photocopies. What I am trying to say is that to reduce the incidence of counterfeiting or photocopying, the CBN must now redesign and reissue these banknotes between five and eight years so that those who think they can take advantage of the system by counterfeiting will know that the game is over for them.
How much of the old banknotes have been mopped up so far?
As I told you, we don’t want to disclose those kinds of volumes, we don’t like to disclose. As we told you, N3.23 trillion is in circulation and out of that N2.72 trillion is outside the bank vaults. And we will insist that the N2.72 trillion must return to the bank vaults by January 31, 2023. If you chose to hold it after January 31s, 2023 it will become useless in your hand. That’s all.