The Central Bank of Nigeria is unable to comply with the recent Supreme Court ruling requiring the reintroduction of the old naira notes due to its inability to obtain the Certified True Copy (CTC) of the court’s judgment.
The Supreme Court ordered that certain denominations of old Naira notes be legal tender until December 31, 2021, reversing the Central Bank of Nigeria’s (CBN) directive to stop their use as legal tender.
However, a report from the News Agency of Nigeria citing an anonymous staff member of the Federal Ministry of Justice, stated that the government must obtain the CTC before it can direct the CBN to comply with the judgment. Efforts are reportedly ongoing to obtain the CTC from the Supreme Court.
The delay in obtaining the CTC has therefore prevented the government and the CBN from complying with the court’s ruling, the report stated.
Some banks are now accepting
A recent Nairametrics check indicates some banks are now complying with the judgment and are gradually paying customers and receiving the old naira notes.
- Mercy, a customer of a bank who spoke to Nairametrics on Tuesday stated that her account officer had informed her to come and collect N5,000 in old naira notes as the bank was now paying.
- Some other banks stated that they had not received any formal instruction but had been told verbally to accept the old notes and pay the same from their vaults.
- There is also fear that some banks do not want to be seen to be breaching court orders, while also flouting central bank directives. To play safe, they accept the old notes.
Meanwhile, long ATM queues remained across Lagos 4 days hours after the Supreme Court decision reversing the apex bank’s new naira note introduction.
Back Story
The Supreme Court had in a judgement passed last week chided the federal government for its naira swap policy, going as far as extending the deadline for swapping old for new notes till December 2023.
Some state governments have accused the central bank policy of being politically motivated to favour opposition parties ahead of the elections.
The central bank is also yet to issue any official communication since the judgment was passed.
- As of Monday evening checks by Nairametrics reveal the apex bank was yet to react to the Supreme Court judgement.
- There is no official statement on its website and none on any of its social media handles.
- Some bankers who spoke to Nairametrics on the condition of anonymity also indicated that they had not received instruction from the central bank.
Currency in circulation drops
Meanwhile, the currency has continued to fall in reaction to the central bank’s cashless policy and efforts to mop up old naira notes.
- According to central bank data for January 2023, currency outside banks, which represents the total currency in the hands of the public, fell to a record low of N788.92 billion.
- The apex bank was able to mop up N1.78 trillion from the hands of the public with its monetary policies, reducing the currency outside the vaults of the banking system from N2.57 trillion recorded as of December 2022 to N788.92 billion.
- In a similar development, the total currency in circulation, which adds to the legal tender in the vaults of the Deposit Money Banks, fell sharply to N1.39 trillion in the same period.
