The Nigeria New Naira Note Controversy

Recently, Nigeria has been facing a backlash for the new Naira note policy...

Recently, Nigeria has been facing a backlash for the new Naira note policy. 

2/20/2023

Nigerian 36 Governors set up committee on new Naira notes | Premium Times  Nigeria

 

It's almost as if "wahala no dey finish" in Nigeria. The new Naira Notes were introduced in October 2022, prompting Nigerians to deposit their old notes for the new ones.

Unfortunately, obtaining the new notes became a scarce commodity for Nigerians. It is now a tug of war on the banks. Many Nigerians are frustrated and agitated as they are conflicted about how to withdraw their hard-earned money. Bank employees reported fleeing their workplace for safety due to long lines at ATMs, ATM destruction, and bonfires on the roads. There are deadlines for people to exchange their old notes, but they keep getting extended as it was clear that the Central Bank could not keep up with the high demand for the new naira notes.

Moreover, the CBN also announced a cash withdrawal limit policy, which is N20,000 daily for an individual. Personally, that is absurd. How do you expect an average working Nigerian to buy food worth N100,000 in the market with such limitations? Fuel prices have increased, hence the increase in transportation. 

Nigerians don't talk about the cost of transport fares; how can they pay danfo drivers? Not to mention the POS; they charge more for any transaction. I recently withdrew N5000 for N1000 charges. An increase in fuel prices equals an increase in market prices. The market is empty because access to cash to purchase their goods is limited. 

The country's economy requires assistance to keep up with a rapidly growing population, high unemployment rates, and rising inflation. Inflation has increased by more than 21.34% in the previous year, making it harder for families to make ends meet. Unemployment is also at an all-time high, with a 33.3% rate, leaving millions of people out of work. Prices on everyday items like food and fuel have skyrocketed, leaving citizens with less money to spend on other necessities. 

Tell me, the Nigerian government, do you want your citizens to starve? Understanding this sort of policy will take the average Nigerian some time because they are not ready for such a change. It doesn't help Nigeria's political leaders, who have yet to find common ground in addressing these issues. There have been disagreements between the apex court, state governors, and the CBN governor over the policy's legality, leading to heated debates within chambers of government. It's like watching WWE shows every day since the new naira note announcement. Despite the disappointment, most Nigerians find the policy unconvincing.

The transition to an economy driven digitally would have numerous benefits, including reducing the rate of counterfeiting and theft. However, there might be potential drawbacks to transitioning from physical cash towards digital money, such as potential security risks, the exclusion of those without access to technology or digital literacy, and the inability to use physical cash as a means of emergency funds. 

Despite these setbacks, we should not ignore them. There would be an impact on those who rely on physical cash as their primary currency. The potential risks need to be addressed by governments and financial institutions by investing in reliable digital payment systems, providing resources to teach people how to use them properly, and ensuring that those without access to technology still have all the financial resources they need.

It is time for them to come together and devise a plan to get the nation's economy back on track. A decisive response is needed to ensure the financial stability of its citizens.

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