Large Withdrawals Lead to Cash Scarcity in Specific Locations, Reports CBN

The Central Bank of Nigeria (CBN) has assured the public that there is enough cash in circulation for economic activities in the country. The CBN said that the cash shortage in some areas was due to high demand from banks and customers, and not to any scarcity of currency notes.

In a statement posted on its X (formerly Twitter) account, @cenbank, the CBN said that its branches across the country were working to ensure smooth cash flow in their respective states. The statement, signed by its Director of Corporate Communications, Dr Isa AbdulMumin, urged the public to use alternative payment methods, such as electronic transfers, cards, and mobile money, to reduce the reliance on physical cash. The CBN also advised the public to avoid panic withdrawals, as there was enough cash to meet their needs.

However, the statement did not mention the deadline of December 31 for the old notes of N200, N500, and N1,000, as ordered by the Supreme Court of Nigeria in March. The CBN had announced in October last year that it would redesign these notes and phase out the old ones by January 31, 2023. This caused a cash crisis in February, as many people rushed to deposit their old notes before they became invalid. The crisis led to protests and attacks on banks in some cities across the country.

The Supreme Court later extended the validity of the old notes to December 31, after hearing a petition filed by some civil society groups and individuals. The petitioners argued that the CBN’s decision was arbitrary, unconstitutional, and detrimental to the economy. They also accused the CBN of not providing adequate information and awareness to the public about the redesign and withdrawal of the old notes.

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