CBN Reaffirms Validity of Old Naira Notes Until December 31, 2024: Public Urged to Embrace Alternative Payment Channels

The Central Bank of Nigeria’s (CBN) latest reaffirmation of the validity of the old ₦1000, ₦500, and ₦200 banknotes until December 31, 2024, has reignited memories of Nigeria’s turbulent cash redesign and demonetization saga in late 2022 and early 2023. During that period, the redesign of the naira sparked widespread economic disruptions, including a cash shortage that affected millions of Nigerians. The Supreme Court ruling of November 29, 2023, eventually settled the debate by permitting the concurrent circulation of both old and redesigned banknotes.

Reflecting on the aftermath, Mrs. Hakama Sidi Ali, Acting Director of Corporate Communications at the CBN, has urged Nigerians to disregard misinformation suggesting an indefinite cessation of the old denominations. She emphasized the bank’s commitment to ensuring all versions of the naira remain legal tender in compliance with the Supreme Court ruling.

A critical takeaway from this development is the resilience of Nigeria’s informal economy, which heavily relies on cash transactions. Despite CBN’s encouragement to adopt alternative payment channels, such as e-banking and mobile platforms, rural areas and small-scale businesses remain cash-dependent. Experts argue that balancing the availability of physical cash with increased digital payment adoption is essential to avoid similar economic shocks in the future.

Case studies from markets in Lagos and Kano illustrate how traders are handling the dual circulation of old and redesigned notes. Many traders expressed relief at the CBN’s clarification, citing previous instances where misinformation led to a rejection of old notes and financial losses.

Moving forward, the CBN has reiterated its call for Nigerians to handle all denominations of the naira with care to ensure their longevity. Mrs. Sidi Ali stressed the importance of public trust in the naira, urging Nigerians to embrace the ongoing transformation of the financial ecosystem to reduce dependency on physical cash.

This reflection serves as a reminder of the critical role the CBN plays in managing monetary policy, building public confidence, and ensuring seamless transitions in Nigeria’s evolving payment systems.