Since the Central Bank of Nigeria (CBN) announced plans to redesign the 200, 500, and 1,000 naira notes with effect from Thursday, December 15, 2022, the development has led to chain of reactions with many hoarders literally falling over themselves as they release hurls of cash hitherto stashed away in their closets, reports Ibrahim Apekhade Yusuf.
Some five years ago when this reporter embarked on a pilgrimage to the Holy land in Mecca, in Saudi Arabia, during the return journey back to Nigeria, airport officials at Jeddah literally searched every luggage with a fine tooth comb all in a bid to ensure that no passenger was carrying any contraband in the first place and to also ascertain that each of our personal effects including hand luggage didn’t go beyond the minimum weight limit of 10kg allowed.
Low and behold, when they got to the turn of a middle-aged woman she had excess luggage. But that is not even the issue. At issue is that they found all manner of nondescript items from rusty mugs, half eaten loaves of bread already given off bad odour, dried beef oozing out maggots, teabags, you name it!
Pronto, the officials had those items confiscated and later whisked her away.
The above short anecdote becomes apposite in describing the current anguish by Nigerians, especially currency hoarders caught up in the web of the new Naira redesign plan announced by the Central Bank of Nigeria (CBN).
The CBN Governor, Godwin Emefiele had penultimate Wednesday said that the apex bank would redesign the country’s currency from 200 Naira denomination to N1,000 notes.
He said that the action was taken in order to take control of the currency in circulation just as he insisted that the bulk of the nation’s currency notes were outside banking operations and that the CBN would not allow the situation to continue.
Emefiele also complained that Nigerians are hoarding about N2.7 trillion from the financial system.
Out of the N3.3 trillion in circulation, only N600 billion is in the vaults of commercial banks. Emefiele said this shouldn’t be allowed to happen, and also advised Nigerians to start keeping their money in banks.
outside banking operations and that the CBN would not allow the situation to continue.
Emefiele also complained that Nigerians are hoarding about N2.7 trillion from the financial system.
Out of the N3.3 trillion in circulation, only N600 billion is in the vaults of commercial banks. Emefiele said this shouldn’t be allowed to happen, and also advised Nigerians to start keeping their money in banks.
The redesigning of the naira notes will compel Nigerians to take the hoarded currency out, in order to collect the new designed notes.
The planned policy he added, was in line with Sections 19, subsections A and B of the CBN Act 2007, upon which the management of the CBN sought and obtained the approval of President Muhammadu Buhari to redesign, produce, and circulate new series of banknotes at N200, N500, and N1,000 notes.
No longer at ease with currency hoarders.
Expectedly, following the new policy regime on the new naira redesign, most of the banks have been receiving heaps of naira notes as many hoarders are bringing in their cash hurl.
Taiwo Hassan, who deals on building materials who went to one of the commercial banks (name withheld) to transact revealed that he was paid in naira notes produced over 15 years ago, all fresh mints.
“When I visited my bank last Wednesday, I was paid in freshly minted N200 notes printed over 16 years ago. And to think that I was in the same bank to request for similar thing was very much surprising,” he said, adding that the new rule will lead to a lot of discoveries.
Investigation by our correspondent revealed that most illegal hoarders have been avoiding official forex market just to evade arrest by the Economic and Financial Crimes Commission (EFCC).
It may be recalled that the anti-graft czar, Abdulrasheed Bawa, had stated that individuals with illicit local currency could use the parallel market as dumping ground in exchange for dollars ahead of the December 15 release date for the redesigned naira notes.
As a result, demand for dollar will rise, causing the value to appreciate against naira, and enabling Bureau De Change operators to continue charging at a premium.
Psychology of money hoarders
Wale Atanda, a psychologist, said hoarding money involves an unhealthy obsession with the accumulation of financial reserves.
Compulsive hoarders, he stressed, feel emotional attachments to their money and possessions, making it difficult for them to spend or discard accumulated items.
“Just as all types of hoarding illnesses prompt people to accumulate things they don’t really need, the activity of hoarding money is likely to trigger a short-term burst of good feelings.”
Traditionally, hoarding has been seen as a symptom of Obsessive Compulsive Disorder (OCD) or Obsessive Compulsive Personality Disorder (OCPD).
Obsessive Compulsive Personality Disorder (OCPD).
The Economic and Financial Crimes Commission has applauded the move by the CBN, to redesign and reissue higher denominations of the Naira.
Responding to the development, the Executive Chairman of the EFCC, Abdulrasheed Bawa described the move by the apex bank as “a well-considered and timely response” to the challenges of currency management which has negatively impacted the country’s monetary policy and security imperatives.
“The EFCC, the CBN and some other regulators in the financial sector have worked closely in the recent past to determine how best to stabilise the country’s monetary policy environment. It is heart-warming that the CBN has demonstrated courage in taking this bold decision which I believe will bring sanity to the current management situation in Nigeria,” he said.
Culled from:The Nation Newspaper.
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