Just days after the Central Bank of Nigeria (CBN) announced the redesign of the N1,000, N500 and N200 notes, with a directive that the current notes be remitted to the commercial banks, wealthy individuals and organisations with huge cash stashed away have begun depositing them.
Reports from the operations department of many commercial banks have it that though there is yet to be any rush by customers, there was a gradual increase in the volume of cash and amounts being remitted by customers.
The Governor of the CBN, Mr Godwin Emefiele, while announcing the issuance of the new naira notes on October 26, said bank customers should start paying their current notes to enable them to withdraw the new bank notes once circulation begins on December 15, 2022.
Emefiele said the apex bank had become concerned over some daunting challenges in the management of the existing bank notes in circulation, especially those outside the banking system, noting that such portend some consequences for the integrity of the CBN and the country.
Among the challenges that informed the decision, he lamented, was the “significant hoarding” of the banknotes in which case N2.73tn out of the N3.23tn currency in circulation as of September 2022 was outside the vaults of the commercial banks across the country.
He also cited the worsening shortage of clean and fit banknotes; increasing ease and risk of counterfeiting evidenced by several security reports and compliance with global standard to circulate new legal tender every five to eight years.
He noted further that the naira redesign would help to rein in the currency outside the banking system and make its monetary policies more efficacious, deepen its cashless economy drive and minimise incidents of terrorism and kidnapping as the access to large sums used for ransom payment.

“On the basis of these trends, problems, and facts set out above, and in line with provisions of Sections 2(b), section 18(a) , and section 19, Subsections a and b of the CBN Act 2007, the Management of the CBN has sought and obtained the approval of President Muhammadu Buhari to redesign, produce, release and circulate new series of banknotes at N200, N500, and N1,000 levels.

“In line with this approval, we have finalised arrangements for the new currency to begin circulation from December 15, 2022 after its launch by President Muhammadu Buhari.

“The new and existing currencies shall remain legal tender and circulate together until January 31, 2023 when the existing currencies shall cease to be legal tender”, he noted.

Meanwhile, interactions with many bank staff have indicated that individuals have begun depositing huge cash sums stashed away with the commercial banks.

A top banker with one of the first generation banks, who spoke on condition of anonymity, said there was a gradual increase in the sums of money being deposited by some customers.

“We have seen an increase in the amount being brought to some of our branches by some customers”, the source said.

On the highest amount an individual had remitted so far, the source, who heads a branch of the bank in Oshodi, Lagos, said, “The amounts vary, but we have seen people bring between N5m and N20m cash. It’s only rich customers that can have huge sums stashed away. The poor live on daily income and can hardly have enough to save”.

He said it was easy to identify the money stashed away for a long time because of the smell, the dates on them and other elements he refused to disclose.

“There are ways to identify them, but I don’t want to go into that because the focus of the CBN policy is to rein in the volume of cash in circulation. The regulators would deal with the rest”, he stated.

The branch manager of another first generation bank in Ikoyi area of Lagos confirmed to newsmen that there was already a rise in the amount of cash being deposited by some customers.

She said, “The normal deposit by average income earners and businesses continues, but some customers have been coming with huge sums to deposit. We have seen some persons bring N2m cash and there have been higher and lesser amounts respectively from some other branches”.

Meanwhile, a senior staff at the headquarters of another first generation bank noted that feedback from some of their branches showed that some customers brought in billions, some in millions and some in hundreds of thousands.

The source said, “When the redesign of the naira was announced, the CBN asked all the banks to report the amount in their vault per day so they could monitor the remittances across board.

“The way it works is that branches route that information through their respective zones and the zones supply the information to the headquarters.

“We have to protect the customers, even if you suspect the possible source of such funds. The information from some of our branches indicate that in the last few days, specifically since October 26 when the CBN made the announcement, there have been individuals who brought in billions while some came to deposit millions.

“From what the CBN Governor said in his briefing, he said about 85 per cent of the cash in circulation was outside the bank vaults”.