Abuja, Nigeria
CNN
—
Nigeria was forced to postpone plans to replace banknotes with a redesigned currency on Wednesday after chaotic scenes at ATMs as millions struggled to get new cash.
The country’s old banknotes were supposed to cease to be legal tender from February 11, but the country’s Supreme Court postponed that deadline after banks were unable to pay enough of the new naira.
Nigerian is becoming I’ve been standing in long lines at Cashpoint since the end of last month after rushing to deposit my old bills ahead of the first deadline on January 31st.
That shortage has led to mood swings and immense hardship for millions of Nigerians, especially those working in the cash-based informal economy and citizens living in rural areas.
Nigerians say they struggle to pay for food and public transport because vendors refuse electronic payments. Multiple sources told CNN that pressure on the bank’s infrastructure has caused many servers to fail.
Last November, President Muhammadu Buhari Unveiled a redesigned currency It aims to curb counterfeiting and large-scale hoarding outside the banking system.
Nigerian central bank governor Godwin Emefil said in January that of the 3.23 trillion naira ($6.9 billion) of Nigerian naira in circulation as of last October, “only 500 billion naira came from the banking industry.” said a whopping 2.7 trillion Naira ($5.8 billion). was “kept permanently in people’s homes”
Emefiele added that about 1.9 trillion naira (about $4 billion) has so far been returned to the banking system since the new banknotes were first introduced. in November.
The redesigned banknotes were intended to replace the old series of 200, 500 and 1,000 Naira notes on January 31, but a 10-day extension was announced after widespread outcry over the timing. rice field.
The new notebook looks very similar to the one in circulation, the only significant difference being the color change. However, President Buhari said last year that the new naira notes are “enhanced with security features that make counterfeiting difficult”.
Abraman Abdullahi, who lives in the Nigerian capital of Abuja, told CNN he needed cash urgently as he was running out of food and unable to replenish supplies. Banks across the country are increasingly becoming targets of growing anger over frustrating searches for new Naira notes.
Nigeria’s largely informal economy relies primarily on cash, CBN It’s a policy that analysts consider premature, but it seeks to encourage people to take more advantage of e-banking.
Nigerians desperately rely on banks to distribute new bills after the February 10 deadline. When exchanging old currency, many people rushed to deposit old banknotes. But the bank doesn’t have enough money. It revolves around new notes, fueling outrage from individuals. vandalized bank property or stripped down to underwear Furious, according to video shared on social media.
“I have been here for hours,” Abdullahi told CNN. ATM of a bank in Abuja, the capital of Nigeria.
“I have to buy groceries, which was very difficult for me.
At a nearby bank, staff instructed customers not to exceed 10,000 naira ($22) per person from ATMs. Customers of other banks were instructed to withdraw only 1,000 Naira (less than $3) from ATMs.
In one supermarket in Lagos, cash was limited to just 1,000 Naira (less than $2) from the machine, despite long waits.
“What can you do with 1,000 Naira! This government doesn’t care about us,” security guard Joel Johnson told CNN.
The government and CBN are under pressure, with governors of three Nigerian states fighting in court The short window of time given to exchange old notes for new ones could lead to a “breakdown of law and order” ahead of a crucial presidential vote later this month, they warn. .
To make matters worse, Nigerians face long queues for fuel across the country, and citizens suffer hardships caused by a scarce currency and high fuel prices. It has led to growing anger and dissatisfaction with the protests taking place in parts of the country.
One person has been reportedly killed in clashes between protesters and police in Nigeria’s third most populous city, Ibadan. According to local media.
Economist Bismarck Lewane told CNN that Nigeria’s transition to new banknotes could have been handled better, adding that a shortage of new banknotes would hurt the country’s economy.
“It will lead to disruption and contraction of economic activity,” says Lewein. “The GDP numbers for the first quarter of this year will be affected.”
CBN Guarantee “ATM queues will soon be gone,” it said, directing commercial banks to pay new bills over the counter, but with a “maximum withdrawal limit of N20,000 ($43) per day.”
Buhari said he was “aware of the cash shortages and difficulties facing people and businesses due to Naira’s redesign”. feel safe “From now until the 10 February deadline, we have seen significant improvement,” the Nigerian said.
The current shortage of cash is not the only funding gap facing Nigerians.
A year-long fuel shortage has worsened in the past few weeks, leaving many cash-strapped Nigerians unable to buy petrol. Prices have tripled in some parts of the country.
The national oil company NNPC has blamed the lingering shortage: distribution issuesAnalysts say fuel shortages could hamper the ruling party’s chances in February’s polls.
“It has implications for politics in that the ruling party is suffering disapproval from voters because of the hardships they face,” says Sam Amadi, a leading political analyst.
“People will mark the government as a failure…and that could affect the fate of the ruling party,” Amadi told CNN.
Buhari is in his final second term, and the ruling party wants his successor candidate Bora Tinub, the former governor of Lagos, the country’s richest state.
Amadi has suggested that the shortage of new Naira could have a positive impact on upcoming elections.
“If managed well, it could actually reduce vote buying, which is probably (one of) the strategic goals of monetary policy around the new naira,” he said.
vote purchase Features of Nigerian elections, Wounded by violence and recent fraud.
