Naira scarcity escalates in Nigeria amid impending old banknote deadline

In the wake of the Central Bank of Nigeria’s (CBN) deadline for the use of old N200, N500, and N1000 banknotes, an escalating scarcity of Naira is being experienced in Kano and Borno states. The CBN had stated that these notes would remain legal until December 31, 2023, following a Supreme Court order. However, an appeal by former CBN governor Godwin Emefiele to deposit old notes before January 31, 2023, led to nationwide protests and attacks on banks.

Despite these protests, the Supreme Court extended the validity of these notes until year-end. Now with only two months left before the deadline, businesses in Kano and Borno states are grappling with cash shortages. In contrast, Lagos and other southern regions continue to experience unhindered economic activities with an ample supply of cash.

A Point of Sale (PoS) operator in Kano reported that banks were imposing daily withdrawal limits for individuals and corporate entities due to the scarcity. This has resulted in decreased cash availability at PoS centres as people rush to deposit their money before the deadline.

The scarcity of Naira in Maiduguri, Borno State is severely impacting residents and traders as transactions are increasingly limited by cash availability. This has resulted in increased online transactions. A bank employee disclosed that their bank had set a daily withdrawal limit of N20,000 due to the scarcity.

Bureau de Change (BDCs) operators on Sheraton Road in Wuse Zone 4, Abuja have also reported a resurgence in Naira scarcity. They believe this is due to banks mopping up cash ahead of the December deadline for the expiration of the old notes.

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