The Central Bank of Nigeria has expressed its intention to extend indefinitely the validity of the old N200, N500, and N1,000 notes, while working to reverse a court ruling on the matter.
The Central Bank of Nigeria has expressed its desire to extend the validity of old Naira notes indefinitely, working with authorities to challenge an existing court ruling on the matter.
This announcement was made through a statement signed by Isa AbdulMumin, the Director of Corporate Communications, on Tuesday.
The decision is in line with international best practices and aims to prevent issues encountered in the past. The CBN is taking steps to vacate the existing court ruling and emphasizes that all banknotes issued by the CBN will continue to remain legal tender beyond the initial December 31, 2023, deadline.
The statement titled, ‘CBN To Allow Old Design Naira Banknotes as Legal Tender, Ad Infinitum,’ said the decision is line with international best practices and to forestall a repeat of earlier experiences.
The statement read, “Without prejudice, the Central Bank of Nigeria wishes to inform the general public of its desire to extend the legal tender status deadline of the old design of N200, N500 and N1,000 denominations; ad infinitum.
“This is in line with international best practices and to forestall a repeat of earlier experiences. Thus, all banknotes issued by the Central Bank of Nigeria, in accordance with Section 20(5) of the CBN Act 2007, will continue to remain legal tender, ad infinitum. even beyond the initial December 31, 2023, deadline.
“The Central Bank of Nigeria is working with the relevant authorities to vacate the subsisting court ruling on the same subject. Accordingly, all CBN branches across the country will continue to issue and accept all denominations of Nigerian banknotes, old and redesigned, to and from deposit money banks.
“The general public is enjoined to continue to accept all Naira banknotes (old or redesigned) for day-to-day transactions and handle these banknotes with utmost care, to safeguard and protect the lifecycle of the banknotes. Also, the general public is encouraged to embrace alternative modes of payment, e-channels, for day-to-day transactions.”
The recent statement by the Central Bank of Nigeria marks the third clarification regarding Naira notes. In a prior announcement earlier this month, the CBN addressed concerns of Naira scarcity in the country. Subsequently, it reiterated that all banknotes, old and new, retain their legal tender status and should not be rejected.
These statements follow a Supreme Court ruling in March, instructing the CBN to allow the old N200, N500, and N1,000 notes to remain legal tender until December 31, 2023, after the introduction of a new naira design policy with expiration dates for these denominations.
In October 2022, the former Central Bank of Nigeria Governor, Godwin Emefiele, revealed plans to redesign specific naira denominations (N200, N500, and N1000 notes) and reduce currency circulation.
Emefiele aimed to control currency flow, combat counterfeit money, and deter ransom payments to kidnappers and terrorists. The existing old N200, N500, and N1,000 notes were initially slated to maintain legal tender status until January 31, 2023, with a subsequent extension to February 10, 2023.
However, this policy faced legal challenges, with Zamfara, Kogi, and Kaduna state governments filing a suit against the Attorney-General of the Federation on February 3, 2023.
Lagos, Ondo, Ekiti, Kano, Sokoto, Ogun, and Cross River subsequently joined the legal action as co-plaintiffs. In a March 2023 ruling, the Supreme Court invalidated the new naira design policy, citing inadequate consultation and non-compliance with constitutional provisions.
Following the Central Bank of Nigeria’s latest directive, Nigerians can anticipate the continued acceptance of old N200, N500, and N1000 notes beyond December 2023.
