- The Central Bank of Nigeria has said it would pump lower denominations into circulation to curb inflation
- The CBN governor, Emefiele, said that there would be a reduction in the circulation of N500 and N1,000 notes
- He hinted that the bank would take a cue from advanced economies which have lower denominations of their currencies in circulation
The Central Bank of Nigeria plans to reduce the number of N500 and N1000 notes in circulation to curb inflation.
The governor of the Central Bank of Nigeria, Godwin Emefiele, disclosed this during the Monetary Policy Committee meeting o November 22, 2022.
Plans to introduce lower denomination underway
The CBN helmsman was responding to questions about counterfeiting essential notes.
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He said the effort to reduce inflation which he partly blamed on the higher-denominated notes.
He was responding to questions about the ease of counterfeiting one thousand naira notes and if there are plans to reduce the volumes.
Emefiele said in the UK, the 50 pound is the most spent bill, followed by the 20 pounds, stating that Nigeria has the opposite.
He said more N500 and N1000 notes are in circulation than the lower ones.
“So in fact, yes we will launch N200, N500, and N1000 over time we will reduce the volume of N500 and N1000 in circulation. Let people carry N50 around. “
According to reports, the announcement by Emefiele will affect the volume of cash transactions in Nigeria as Nigeria is still heavily dependent on cash despite CBN’s cashless policy.
Analysts believe businesses relying on cash transactions will suffer but would favour the much-touted cashless economy of the CBN.
The comment by the CBN boss may trigger a backlash from financial and monetary analysts.
Buhari set to unveil new naira notes on Wednesday in Abuja
Legit.ng reported that many Nigerians will get a sneak peek of newly redesigned naira notes on Wednesday, November 23, 2022, when President Muhammadu Buhari unveils them.
According to a Premium Times report, the President will unveil the new notes during the Federal Executive Council meeting in Abuja.
The Central Bank of Nigeria announced on October 26, 2022, that it would redesign N200, N500 and N1,000 notes and gave December 15, 2022, as the date to begin circulating the new naira notes.