Naira: Old N200, N500 and N1,000 Remain Legal Tender Indefinitely – CBN

The Central Bank of Nigeria (CBN), Thursday said it does not intend to discontinue the circulation of the old series of N200, N500 and N1,000 banknotes by December 31, 2024.

The central bank’s clarification came on a day the House of Representatives called on the apex bank to increase issuance of the newer N200, N500 and N1,000 denominations, and commence the phase out of old notes from circulation before the December 31, 2024 deadline for their discontinuation.

The House further urged the apex bank to order commercial banks to immediately stop cash payment to their customers with old N200, N500 and N1,000 notes as well as engage in gradual mopping up of the old notes.

The resolution of the lower chamber, which was moved at plenary by Afam Ogene, followed the adoption of a motion of urgent national importance on the need for CBN to sensitise Nigerians about the non-legal tender status of old naira notes from January 1, 2025.

Ogene expressed worry that the CBN had not shown any sign of sensitisation or kick-started any awareness programme to remind Nigerians about this important economic policy in order to make them prepare for the deadline of December 31, 2024.

However, the CBN in a statement issued by Mrs. Sidi-Ali, Hakama, the acting director, Corporate Communications Department, said such claims by the House are “false and calculated to disrupt the country’s payment system”.

For the avoidance of doubt, the CBN maintained that the order of the Supreme Court on Wednesday, November 29, 2023, which granted the prayer of the Attorney-General of the Federation and Minister of Justice to extend the use of old Naira banknotes ad infinitum, remains in force.

Similarly, the CBN’s directive to all its branches to continue to issue and accept all denominations of Nigerian banknotes, old and re-designed, to and from deposit money banks (DMBs) remains in force.

Hakama further pointed out that the central bank’s earlier directive to all its branches to continue to issue and accept all denominations of Nigerian banknotes, old and re-designed, to and from deposit money banks (DMBs) was still in effect.

The Supreme Court had ordered that the old series of N200, N500, and N1,000 banknotes shall continue to be legal tender alongside the redesigned versions.

Accordingly, all banknotes issued by the CBN will continue to remain legal tender indefinitely, the statement added.

Hakama said,

“We, therefore, advise members of the public to disregard suggestions that the said series of banknotes will cease to be legal tender on December 31, 2024.

“We urge Nigerians to continue to accept all Naira banknotes (old or redesigned) for their day-to-day transactions and handle them with the utmost care to safeguard and protect their lifecycle.

“Furthermore, the general public is encouraged to embrace alternative modes of payment, e-channels, in order to reduce pressure on the use of physical cash.”

On November 14, 2023, the CBN announced the extension of the legal tender status of the old N200, N500, and N1, 000 denominations beyond the December 31, 2023 deadline – and with no definite time frame for their retirement.

The bank noted that the decision was in line with global best practices and to “forestall a repeat of earlier experiences”.

The central bank stated, “Thus, all banknotes issued by the Central Bank of Nigeria (CBN), in accordance with Section 20(5) of the CBN Act 2007, will continue to remain legal tender, ad infinitum, even beyond the initial December 31, 2023 deadline.

“The Central Bank of Nigeria is working with the relevant authorities to vacate the subsisting court ruling on the same subject.”

The apex bank had introduced the redesign of N200, N500, and N1,000 denominations in October 2022 and various deadlines were set for the old design of the banknotes to be retired.

However, the economic hardship that resulted from the implementation of the currency redesign programme compelled some state governors to sue the central bank.

The apex bank, however, stated that all “CBN branches across the country will continue to issue and accept all denominations of Nigerian banknotes, old and redesigned, to and from deposit money banks (DMBS)”.

“The general public is enjoined to continue to accept all Naira banknotes (old or redesigned) for day-to-day transactions and handle these banknotes with utmost care, to safeguard and protect the lifecycle of the banknotes.

“Also, the general public is encouraged to embrace alternative modes of payment, e-channels, for day-to-day transactions,” the statement added.