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Friday, 27 January 2023 05:52

Naira Redesign: Traders, Businesses Rejecting Old Notes - Banks run out of cash for ATMs

Some traders and businesses within Lagos and Ogun State axis have started rejecting the old N200, N500 and N1000 denominations for transactions, five days ahead of the January 31st deadline for them to cease to be legal tender.

The traders and business owners are insisting on receiving the new redesigned notes, which are still low in supply across the country, LEADERSHIP checks have shown.

This is as the Nigeria Labour Congress (NLC) yesterday aligned to the position of the Nigerian Senate, calling for an extension of the deadline for collection of the old naira notes.

The senate had earlier this week asked the Central Bank of Nigeria (CBN) to extend the deadline for the exchange of old naira notes to May 31, 2023.

The apex bank is however adamant insisting there is no going back on the deadline.

But the NLC national president, Comrade Ayuba Wabba said the policy will have adverse on the country’s economy and the residents in rural areas.

Comrade Wabba who made the congress position known in Abuja while speaking with journalists, stressed that even though the policy maybe targeted at the rich, but Nigerian workers and the poor masses are more likely to suffer the consequences of the new rule.

The labour leader declared that the congress was in full support of the senate’s position on the matter.

Wabba said, “I have tried to respond by writing officially to the CBN governor, we also wrote to the president , to say that this new policy of changing our Naira noted needs to be revisited.

We align ourselves fully with the position taken by the senate, we call for this policy to be reviewed and to give extension so that all the old notes can then be mopped up by the banks and we call on CBN to go to those hard to reach areas.”

“You are pushing people to the walls and very soon, people will react. If you go to the rural areas, and see the chaotic nature of how people coming with theirs monies to change is becoming a problem. No policy should be made to hunt people like what is happening now

We have called on the government to look at this issue very carefully before it snow balls into a major crisis. In fact, in rural areas it is worst because most of our rural areas do not have banks”, he added.

Meanwhile, LEADERSHIP checks showed that although, with some persuasion, some of them finally collected the old notes, they insisted that they will start outright rejection by today and Saturday

This is even as banks seeming to have run out of the new notes, are leaving many Automated Tellers Machines (ATMs) across Lagos metropolis empty, causing huge queues at the few ATM points that are dispensing. However, in the banking hall, banks were still paying customers with old notes as January 31st, 2023 deadline to stop using of old notes draws nearer.

LEADERSHIP correspondents, who combed some major parts of Lagos State and the outskirts of Ogun State noticed some traders and businesses who render services rejecting old notes as payment for their services, while others informed their customers they will stop accepting old currency by Saturday, despite low circulation of new notes.

As at yesterday, many ATMs visited around Lagos and Ogun States were not dispensing cash and those that had cash were only paid the old N500 and N1,000 notes, thus the scarcity of the N200 note which is mostly used by petty traders.

In Ota, Ogun State, traders, POS and filling stations have set Monday 30th January, 2023 as a deadline for the collection of old naira notes. They have inscriptions around their business premises where they informed customers ahead of the deadline. However, banks were still paying customers with old notes when they withdraw over the counter. One of the banks visited paid customers who rejected the old notes in N100 denomination.

Festus, a customer who rejected the old notes while making a withdrawal inside the banking hall, said: “I don’t want to hold too much cash because of the deadline but I need small cash for running around. When I rejected the old note they gave me N2000 in new notes and N8,000 in N100 notes. I prefer it that way.”

However, at Supermarket and malls, customers were paying in old notes and cashiers were still giving change in old notes unless where they have new ones.

Meanwhile, some businesses premises, who are still collecting the old notes, have inscriptions around their business premises where they informed customers ahead of the January 31st deadline.

According to Gabriel Obadina, business man, “people are still collecting the old notes because I used it to pay transport fares to the office, and more, conductors do not have the new notes, so they collect them and give them to others as change.”

Similarly, a Chinese who spoke to LEADERSHIP said: “I am confused on what to do, I have paid old notes into the bank, but now I don’t have access to new ones, what should I do now?”

LEADERSHIP had earlier reported that traders in Lagos had said they will begin rejecting the old N200, N500 and N1,000 notes by this weekend ahead of the January 31, 2023 deadline set by the Central Bank of Nigeria even as the apex bank said it will intensify efforts to push out the N200 notes.

However, the CBN has also said, it will begin an audit of banks alongside the on site monitoring to know those who are dispensing the new notes and those who are not will be appropriately sanctioned. It had earlier noted that banks will be fined N1 million per day.

Speaking during a sensitisation on the new naira notes by the CBN at the Asejere market in Makoko area of Lagos, the assistant Iyaloja of the market, Memud Iyabo Ajoke, noted that, traders in the market have been informed of the redesign of the currency and have been told to start rejecting the old notes from Saturday, January 28, 2023, three days to the deadline.

She explained that this is to ensure that they do not have the old notes with them by Tuesday, January 31 which is the deadline.

Addressing journalists during the sensitization, deputy director, Banking Services department at the CBN, Josephine Ajala, noted that, all efforts have been made to dispense the new notes.

To him, “so surely, by the 31st, there cannot be any ATM machine that will dispense old notes.

“We just realized that probably people just want to be, collecting or getting N1000 notes. The banks have been instructed that all the denominations that were given must be dispensed. We are doing a lot of audits on them.

“We are following up seriously on them to trace and ensure that whatever we give them most reach the grassroots. So, all the denominations will get to the ATM and they should be in the ATM.”

Ajala who noted that the old notes should not be rejected until the date of the deadline, said: “we are going to be doing a lot of sensitization, we are going to encourage people more to get away from cash.

“We are introducing a lot of cashless platforms, incentives, and more. So the central bank ideally wants to reduce the amount of cash that we use. If you go to countries like some other African countries, they don’t have a lot of cash, most of them are digital in little denominations like 200 they would go digital.

“So, we are putting in a lot of effort to get everybody on board. The new era is now cashless, though it is going to be gradual but that is the focus.”

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