Godwin Emefile, Governor of the Central Bank of Nigeria, Designed naira notes are set to increase the effectiveness of an organization’s monetary policy and strengthen the cause of financial inclusion.
Currency hoarders return to banking
The recently issued naira notes are expected to force currency dealers to return to “hoarding”, according to Nigerian Central Bank Governor Godwin Emefiere. Currency [back] into the banking system. In his speech delivered at the unveiling of the new naira note, Emefiele argued that the new naira note could increase the effectiveness of the country’s monetary policy.
The CBN governor argued that the redesigned Naira notes would likely strengthen the bank’s financial inclusion objectives, as well as help re-enter circulation of older banknotes. Emefiele explained:
We believe this initiative will help promote financial inclusion, transition to a cashless economy and facilitate the formalization of the Nigerian economy. .
According to Emefiele, the old CBN’s task of tracking and identifying suspicious fund movements once work to phase out banknotes of 100, 200, 500 and 1,000 naira is completed. becomes easier. At present, this is not possible as “84.71% of naira notes in circulation are outside commercial bank vaults”.
CBN’s controversial Naira redesign plan
I repeated. The banknote reissue had been green lighted by Nigerian President Muhammadu Buhari.
According to CBN, the current banknote phasing out has been long overdue, but is also a “global best practice for central banks” that must be repeated every five to eight years. There is also. However, after CBN announced plans to replace old Naira notes with redesigned notes, the currency’s parallel market exchange rate against the US dollar fell sharply.
As reported by Bitcoin.com News, the naira’s plunge was due to a sharp surge in demand for the US dollar against a decline in supply. But after Nigeria’s Economic and Financial Crimes Commission began cracking down on so-called illegal currency dealers, the parallel exchange rate for the local currency went from just over 900 units per dollar in October to $1 by 26 November. Improved to just under 800 units per.
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