CBN okays use of old Naira notes ten days after court ruling

Ten days after Nigeria’s Supreme Court ruled that the N200, N500 and N1,000 notes would remain legal tender until December 31, 2023, the CBN has acknowledged the court’s ruling. Last week’s verdict was emphatic, pointing out that the currency redesign policy announced last year was unfair and that Nigerians didn’t receive fair notice. Despite the Supreme Court’s robust judgment, which partly chided President Muhammadu Buhari, long queues could still be seen at Nigeria’s leading banks all week.

Most of the uncertainty was caused by the Central Bank and the Federal Government keeping quiet on the court judgment. There was no indication that the court order would be obeyed, and leading banks refused to receive or issue the old notes. A TechCabal report from last week quotes a bank employee as saying, “The banks cannot act on the Supreme Court ruling because the Central Bank, an independent body, controls us. The Central Bank has not directed us to align with the Supreme Court’s decision, so business will continue as usual.”

Today, the Central Bank confirmed that it would comply with the court’s decision and extend the validity of the old notes to December 31, 2023 while putting the new notes into circulation. But the statement came after a the Federal Government implied that it did not understand why the Federal Government and the Attorney General chose not to obey the court’s ruling. While all that was going on, State governments began the week with media bites telling people to accept and spend the old notes.

The governor of Anambra state, Chukwuma Soludo, also a former Central Bank Governor, said that the CBN had decided to obey the court’s order on Monday morning. At the time of his tweet, the CBN did not comment on the judgment. Nonetheless, Soludo tweeted, “Residents of Anambra are therefore advised to freely accept and transact their businesses with the old currency notes (N200; N500; and N1,000) as well as the new notes.

Residents should report any bank that refuses to accept deposits of the old notes.” The Lagos state governor, Babajide Sanwo-Olu, tweeted on Monday morning, “Kindly note that commercial banks have been directed to accept the old N500 and N1,000 notes as deposits and pay them out for withdrawals.”

Seven after the tweets from state governors–17 of whom sued the Federal Government to court over the Naira redesign policy in the first place–the CBN released a statement. Part of it said, “Accordingly, the CBN met with the Bankers’ Committee and has directed that the old N200, N500 and N1000 banknotes remain legal tender alongside the redesigned banknotes till December 31, 2023. Consequently, all concerned are directed to conform accordingly.”

Many Nigerians will be relieved at the CBN’s acknowledgment of the court judgment and its directive to banks to honor the old notes. There are hopes that it will end the long bank queues people have endured for the last eight weeks. Ultimately, we’re still left wondering about the CBN’s insistence on a policy that left the country in discomfort and subjected citizens to inhumane queues. As you go around this week, finally able to access the Naira, the question on everyone’s lips will be, “what was the point of this policy?”