In response to mounting concerns from bank customers and businesses across Nigeria, the Central Bank of Nigeria (CBN) has addressed the prevailing scarcity of naira notes in the country. Reports of cash shortages at banks, ATMs, Points of Sale (PoS), and Bureaux de Change (BDCs) have triggered a wave of anxieties among Nigerians. The CBN, through its Corporate Communications Department, issued a statement shedding light on the root causes of the perceived currency scarcity, emphasizing the ample supply of naira notes in the economy.
Background:
The scarcity issue gained momentum following the introduction of redesigned N200, N500, and N1,000 denominations by the CBN in October 2022. Initially, certain deadlines were set for the phasing out of the old notes, but last November, the apex bank expressed its intention to extend the legal tender status deadline “ad infinitum.” Despite this, concerns have continued to escalate as residents in major cities, including Lagos, Abuja, Kano, Katsina, Jigawa, and Adamawa, grapple with restricted cash withdrawals from banks.
CBN’s Explanation:
The CBN attributed the apparent currency scarcity to two main factors. Firstly, the large volume withdrawals of cash from various CBN branches by Deposit Money Banks (DMBs) have contributed significantly. Secondly, panic withdrawals by individual bank customers, especially from ATMs, have added to the strain on the available cash supply. However, the CBN has unequivocally stated that there is no shortage of naira notes and assured the public of an adequate stock for economic activities.
Assurance from CBN:
In their official statement, the CBN sought to allay fears, stating, “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 CBN also emphasized the proactive measures taken by its branches across the country to ensure the seamless circulation of cash.
Impact on Business Transactions:
The scarcity of naira notes has not only affected individual bank customers but has also had ripple effects on business transactions, particularly in local markets. In some regions, where cash transactions are preferred over digital transfers, the shortage has caused disruptions. Buyers and sellers, especially in the northern part of Nigeria, have faced challenges in accessing the necessary cash for their transactions.
Conclusion:
As the CBN works to address the perceived scarcity of naira notes, it remains to be seen how the situation will evolve and what additional measures may be taken to ensure the smooth flow of currency in the country. The assurance from the apex bank, coupled with ongoing efforts to manage the situation, provides a glimpse of hope for Nigerians concerned about the accessibility of cash in their day-to-day financial activities.
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