New Telegraph

December 8, 2023

Cash Crisis: Stakeholders task govt to strengthen fintech

Following the lingering cash crisis caused by the redesign of N1000, N500 and N200 notes, stakeholders have called on the government and other concerned regulatory bodies to strengthen the financial technology (FinTech) ecosystem to boost financial inclusion. According to them, fintech is the best banking instrument to implement the cashless policy of the Central Bank of Nigeria (CBN) and needed to be supported by the government. Since the introduction of the new naira notes and with  drawal of the old ones from circulation, Nigerians have been subjected to hardship due to scarcity of enough cash in circulation. The Central Bank of Nigeria (CBN) had in October, 2022, announced the redesign of three denominations of Nigerian currency – N1000, N500 and N200 notes. On December 15, 2022, it commenced the circulation of the new notes while mopping up the old ones from circulation. It, therefore, gave January 31, 2023 deadline for everybody to deposit their old notes at the bank. After the January deadline, the apex bank was forced to extend the deadline to February 10. By this time, the populace has started feeling hardship as the new note in circulation was too meager com-  pared to the amount of the old note that has been out if circulation. It was reported that only N300 billion new notes were released into circulation while about N2trillion old notes had been taken out of circulation. By February 17, the new extended deadline, the old note had ceased to b legal tender, putting more Nigerians in agony. While some people faulted the policy, claiming that the it was deliberately made at the time to scuttle the general elections, the CBN Governor, Godwin Emefiele said the monetary policy was to reduce the size of the cash in circulation and enforce the cashless economy as done in the developed countries. According to him, the exercise has achieved a success rate of over 75 per cent of the  N2.7 trillion held outside the banking system. “So far and since the commencement of this programme, we have collected about N1.9 trillion; leaving us with about N900billion (N500billion plus N1.9trilIion),” he said. He further said that aside from those holding illicit and or stolen naira in their homes for speculative purposes, “we do aim to give all Nigerians that have naira legitimately earned and trapped, the opportunity to deposit their legitimately trapped monies at the CBN for exchange. “We therefore appeal to all Nigerians to work with the Central Bank of Nigeria to ensure a hitch free process for the implementation of this very important programme.” He noted that the apex bank’s aim was mainly to make Nigeria’s monetary policy decisions more effective “and like you can see; we’ve started to see inflation trending downwards and exchange rates relatively stable. “Secondly, we aim to support the efforts of our security agencies in combating Banditry and Ransom taking in Nigeria through this programme and we can see that the Military are making good progress in this important task in Nigeria.

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