. Says exchange of old notes deadline remains January 31st
The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN), yesterday, raised the Monetary Policy rate (MPR), its benchmark interest rate to 17.5%, to contain inflation.
This is even as the apex bank insists the January 31st deadline set to swap the old Naira notes for the new ones remains sacrosanct, despite the persistent calls for extension.
During a post-MPC meeting briefing in Abuja, the CBN Governor, Godwin Emefiele, said: “One member voted to increase the MPR by 150 basis points, four members by 50 basis points, and seven members by 100 basis points. In summary, MPC voted to raise MPR to 17.5 per cent.”
This is the fifth time in a row of increasing the lending rate, a development experts believe has not achieved set targets, as inflation has fallen only by 13 basis points, while affecting the marginal propensity to save.
Ahead of the MPC meeting which started on Monday, experts had urged the retention of rates to enhance market stability.
But in a communiqué read by Emefiele after the meeting, the MPC believe the decision to hike rates back-to-back is yielding fruits with the deceleration of inflation rate, which fell slightly to 21.34% in December 2022.
The Committee also voted to keep the asymmetric corridor at +100 and -700 basis points around the MPR.
The MPC members voted in favour of keeping the Cash Reserve Ratio (CRR) – the share of a bank’s total customer deposit kept with CBN at 32.5% and the Liquidity Ratio (the proportion of deposits and other assets maintained for short-term obligations) at 30%.
I don’t have good news for those who feel we should shift the deadline; my apologies. The reason is because 90 days should be enough for those who have the old currency to deposit it in the banks.
Old notes swap
Meanwhile CBN Governor has reiterated that the January 31st deadline for Nigerians to swap their old N200, N500 and N1,000 notes remains sacrosanct despite the calls for an extension from various stakeholders.
He said: “I don’t have good news for those who feel we should shift the deadline; my apologies. The reason is because 90 days should be enough for those who have the old currency to deposit it in the banks.” he said.
Indeed, the Senate and the House of Representatives yesterday reiterated their calls for the extension of the deadline, in the interest of “the ordinary Nigerians” in the rural areas, which the lawmakers claim do not have access to banks to do the exchange.
While the upper chamber specifically requested for deadline extension to July 31, the lower chamber summoned the CBN Governor and bank operators to appear before it.
The bank operators are to appear today, while Emefiele is expected tomorrow.
But addressing some of the concerns raised regarding access to avenues for the exchange and availability of the new notes, Emefiele after the MPC meeting said: “We have 1.4 million points of our super agents; those agents are going to be available to conduct cash exchanges.
“The super agents are like kiosks, shops in your community, whether it is a riverine or upland area. They are there, selling sweets, selling kola nuts, but they have been appointed as agents that will do cash exchange and cash swap for you. This, we have put in place.”
He added that “We have some information and videos about our staff and agents doing cash swaps in our communities. In areas like Baga, Monguno, Rann on the Lake Chad Basin, in Banki, Kirawa, Gwoza on the borders of Cameroon, Ngoshe, Bama, Chibok, Damboa, Ngala, Izge…all these are areas around the Sambisa.
“Our agents and our staff are all there conducting cash swaps and exchanges of old to new currencies.”
Ahead of the deadline, the CBN ordered commercial banks to stop over-the-counter payment of the new notes and instead load the redesigned naira notes into Automated Teller Machines (ATMs) to improve circulation.
It also introduced a swap programme to enable people in unbanked and remote areas nationwide to exchange the old notes for the new notes.
