Naira Notes Swap: NGF Accuses Adamant CBN & Deposit Banks Of “Currency Confiscation”; Urges Respect For Rule Of Law


“Oga, this is the only job I have for now. I’m not happy to charge my customers high interest but if I don’t do that, it means I have to close the business. You know that when you lose them, it’s not easy to get them back. They know that our charges are the same everywhere” she concluded”

*Gov. Aminu Waziri Tambuwal of Sokoto State & Chairman of Nigerian Governor’s Forum, NGF


Despite the intervention of the National Council of State, the Supreme Court, and other concerned persons, institutions, and well-meaning Nigerians about the naira swap log-jam that has placed the angst of the people against the government, the Nigeria financial institutions have refused to bulge, and open up avenues for free-flow of collection of cash.

Pegasus Reporters and correspondents from across the nation seem to tell one story, the status quo created from the start of the policy by the Central Bank. While most banks are still not easily accessible to customers, ATM machines are still pandemonium spots for customers willing to withdraw their cash.

A customer who spoke with one of our correspondents in Lagos explained that in a particular bank in Ogba in Lagos, non-customers of the bank cannot withdraw more than N1000 naira from the ATM while customers are limited to a maximum of N5000 naira only.

A point of Sales (POS) operator who spoke with Pegasus Reporters explained that while it’s true that the minimum they currently charge for withdrawal is 10% of the amount being withdrawn said that they are not to blame because they too have to pay as much as 5% to make a huge withdrawal to meet their demand from the public.

“You cannot blame us for charging N500 for N5000 naira. We also pay the bank to make these withdrawals to meet our customers’ demands” Asked if it was not better for her to not add to public pains by not charging high for withdrawals, she retorted:

“Oga, this is the only job I have for now. I’m not happy to charge my customers high interest but if I don’t do that, it means I have to close the business. You know that when you lose them, it’s not easy to get them back. They know that our charges are the same everywhere” she concluded.

*Central Bank of Nigerin main Complex, Federal Capital Territory, Abuja

It will be recalled the Nigerian Governors’ Forum, NGF recently released a communique requesting the Central Bank to ease the flow of funds to lessen the hardship currently caused by the apex banks policy. It also condemned the apex bank as pursuing a draconian policy of currency confiscation that attempts to interfere with the citizen’s right to the freedom to use legitimately earned income as they so wish.

Amongst the request made by the NGF and signed by the chairman of the forum Rt Hon. Aminu Waziri Tambuwal is the plea to the public and a 10-point request:

1. It has become necessary to make a distinction between the Central Bank of Nigeria (CBN) Naira redesign policy backed by Section 20 (3) of the CBN Act, 2007 and the aspirational policy of going cashless, both of which are mutually exclusive at this time.

2. It is our considered view that what the CBN is at present pursuing is a currency confiscation programme, not the currency exchange policy envisaged under S20(3) of the CBN Act, 2007. Currency confiscation in the sense that the liquidity provided to the general public is grossly insufficient due to the restrictions placed on the amount that can be withdrawn regardless of the amount deposited.

3. The current approach of the CBN raises concerns about the respect for the civil liberties and rights of Nigerians as it relates to their freedom to use legitimately earned income as they so wish.

4. The Forum believes that to deploy a cashless policy and deepen digital transactions, the best practice around the world is to create a suite of incentives to attract customers; rather than a draconian approach as we have witnessed in the last three months.

5. The argument by the CBN for what it describes as the astronomical increase in the currency in circulation as the basis for this policy is not supported by its own data. According to the CBN, the currency in circulation increased from N1.4 trillion in 2015 to N3.23 trillion in October 2022. The Bank appears not to have taken into consideration the increase in the size of the country’s nominal GDP over this period, the doubling of consumer prices, the rising population, and the impact of the humongous Ways & Means advances to the federal government by the Central Bank of Nigeria over this period.

6. In the circumstances, it is safe to draw either of two conclusions – the CBN data may be incomplete or in fact, Nigerians may have done exceptionally well in the transition to a cashless economy.

7. In addition, considering the sizeable informal sector in the nation, the amount of banknotes created in exchange so far by the CBN implies it vastly underestimated the economy’s actual cash needs. The inability to use the new notes has had far-reaching economic effects, leading to the emergence of the Naira black market, severe food inflation, variable commodities prices based on the method of exchange,and long queues as well as crowds around Automated Teller Machines (ATMs) and banking halls across the country with individuals hoping to get a fraction of their money in new notes to meet their daily livelihood. The country runs the risk of a CBN-induced recession.

8. While we acknowledge the submission of the Attorney General of the Federation that the Federal Government will comply with the ruling of the Supreme Court which calls for the halting of CBN’s plan to end the use of the old currency notes, we are yet to observe changes in the financial system.

9. Consequently, we call on the Federal Government and the CBN to respect the Rule of Law and listen to the voice of reason expressed by Nigerians and several other stakeholders including the Council of State, before the damage to our economy becomes too great to fix by the next administration.

10. Members rose from the meeting agreeing to direct their Attorneys General to review the suit at the Supreme Court with a view to consolidating the legal reliefs pursued by States.

Meanwhile, as Nigerians are denied access to their legitimately earned income, the nation awaits the next steps from Governor Emefiele.

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