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CBN extends validity of old Naira notes indefinitely

Central Bank of Nigeria's move follows international best practices, as it works to overturn a court ruling on the matter

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In a recent announcement, the Central Bank of Nigeria (CBN) revealed its intention to extend the validity of old N200, N500, and N1,000 naira notes indefinitely. The apex bank expressed its desire to prolong the legal tender status of these denominations beyond any specific expiration date, aligning its decision with international best practices.

The statement, titled ‘CBN To Allow Old Design Naira Banknotes as Legal Tender, Ad Infinitum,’ was released by Isa AbdulMumin, the Director of Corporate Communications at CBN, on Tuesday. The CBN emphasized its commitment to preventing a recurrence of past challenges related to currency transitions.

The statement reads, “Without prejudice, the Central Bank of Nigeria wishes to inform the general public of its desire to extend the legal tender status deadline of the old design of N200, N500, and N1,000 denominations; ad infinitum. This is in line with international best practices and to forestall a repeat of earlier experiences.”

The CBN is actively collaborating with relevant authorities to challenge an existing court ruling on the same subject. The statement assures the public that all banknotes issued by the CBN will remain legal tender indefinitely, even beyond the initial deadline of December 31, 2023.

The CBN encourages the public to continue accepting both old and redesigned Naira banknotes for everyday transactions. Additionally, it suggests embracing alternative payment methods and electronic channels for day-to-day transactions.

This announcement marks the third statement by the CBN in recent times concerning Naira notes. Earlier in the month, the CBN clarified that there was no scarcity of Naira in the country. Subsequently, it affirmed that every banknote remains legal tender and should not be rejected.

The CBN’s clarification and actions are in response to a Supreme Court ruling in March, which instructed the CBN to allow old N200, N500, and N1,000 notes to remain legal tender until December 31, 2023. This ruling came after the CBN had announced a new Naira design policy with expiration dates for certain denominations.

Former CBN Governor Godwin Emefiele had disclosed plans to redesign Naira denominations and reduce currency circulation as a measure to control counterfeit currency and ransom payments. The legal tender status of the existing old notes was initially set to expire on January 31, 2023, then extended to February 10, 2023. However, the Supreme Court invalidated the new Naira design policy in March, citing a lack of due consultation and compliance with constitutional provisions.

With this latest directive, Nigerians can now expect to continue using old N200, N500, and N1,000 notes beyond December 2023.

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