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Naira: Nigerian Government urges Supreme Court to extend validity of old banknotes beyond December 31

Old Banknotes

*Lateef Fagbemi, Attorney-General of the Federation, in a fresh application, discloses the Federal Government is asking the Supreme Court of Nigeria to allow both the old and new N200, N500 and N1000 banknotes to remain in circulation after December 31, 2023, to prevent consumers from further economic and financial crisis, as experienced in the first quarter of this year in the economy

Isola Moses | ConsumerConnect

Sequel to the recent pronouncement of the Central Bank of Nigeria (CBN) on extension of the legal validity of the old Naira banknotes – N200, N500 and N1000 – the Federal Government Wednesday, November 22, 2023, urged the Supreme Court of Nigeria, in Abuja, FCT, to grant an extension of time for old banknotes to remain in circulation as legal tender in the economy.

ConsumerConnect reports the government also has asked the apex court to lift its order handed down March 3 this year, that the old Naira notes should remain alongside the new notes till December 31, 2023.

Dr. Olayemi Cardoso, Governor of CBN

It is recalled the Central Bank of Nigeria, March this year, had said old N200, N500, and N1,000 banknotes would remain legal tender till December 31.

The Bankers’ Bank also noted that the extension of time was necessary, and it had not been able to print the volume of new Naira notes that would enable it to phase out old currency before the December 31 order.

Lateef Fagbemi, Attorney-General of the Federation (AGF), in the fresh application, stated the Federal Government is seeking the following reliefs:

An order of the court reviewing its consequential order contained in the judgment of 3rd March, 2023, to the effect that the old N200, N500 and N1,000 notes should be legal tender until the 31st of December, 2023.

The Nigerian Government further explained that should the Supreme Court decline its request to extend the period of circulation of old notes, the country stands the risk of descending into another national, economic and financial crisis as witnessed in the first quarter (Q1) of the year when the Naira redesign policy was being implemented under the leadership of Mr. Godwin Emefiele, former Governor of CBN.

The government as well asked the Supreme Court to allow the old notes to be in use with the new notes until after it consults with stakeholders, pointing out that the economy may be in jeopardy once again because some Nigerians have started hoarding the old and new naira notes ahead of the December 31st timeline.

Old Naira banknotes remain legal tender: CBN

It is recalled that the Central Bank of Nigeria (CBN) recently clarified that both old and new (redesigned) Naira notes remain legal tender in the West African country.

Dr. AbdulMumin Isa, Director of Corporate Communications at CBN, in a statement had said the attention of the Bank had been called to “reports of a scarcity of cash across some major cities in the country despite assurances of sufficient cash stocks in all locations across the country.”

The CBN Spokesman stated: “There have also been reports of anxiety among some members of the public over the legality or otherwise of old Naira banknotes.

“For the avoidance of doubt, while reiterating that there are sufficient banknotes across the country for all normal economic activity, we wish to state unambiguously that every banknote issued by the Central Bank of Nigeria (CBN) remains legal tender and should not be rejected by anyone, as stipulated in Section 20(5) of the CBN Act, 2007.”

Isa, in the statement noted that branches of the CBN across the country have been directed to continue to issue different denominations of old and redesigned banknotes in adequate quantities to deposit money banks (DMBs) for onward circulation to bank customers.

“We wish to restate that all denominations of banknotes issued by the Central Bank of Nigeria (CBN) remain legal tender.

“In line with Section 20(5) of the CBN Act, 2007, no one should refuse to accept the Naira as a means of payment,” it further stated.

The CBN further said: “Consequently, members of the public are advised to accept all CBN-issued banknotes currently in circulation and guard against panic withdrawals.

Stakeholder engagements ongoing, says government

Meanwhile, the Federal Government said it had been engaging the 10 plaintiff states in their capacities as members of the National Council of State and the National Economic Council (NEC) on the matter.

The 10 plaintiff states, including Kaduna, Kogi and Zamfara, had approached the Supreme Court in the interest of the public, leading to judgment, in which the  court extended the circulation of the old notes till December 31.

It was gathered the Federal Government had realised that unless there is a fresh order from the country’s Supreme Court, the old banknotes, legally speaking, would no longer be in circulation after December 31.

The Supreme Court has fixed November 30 for a hearing, according to report.

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