The Senate has endorsed its legislative support for the re-design of the new bank notes approved by President Muhammadu Buhari as initiated by the Central Bank of Nigeria being the only Agency saddled with such powers.
It also mandated the Committee on Banking, Insurance, and other Financial Institutions to embark on an aggressive oversight to ensure that Nigerians are adequately protected from the CBN, Banks, and other agencies involved in the process.
The Senate position was in line with the prayers of the motion presented by Senator Uba Sani who is also the Chairman, senate committee on banking and other financial institutions
Presenting the motion before the Senate plenary, Senator Uba Sani explained that currency management is a key function of the Central Bank of Nigeria and the integrity of the Naira and efficient supply of banknotes are indicators of a performing Central Bank, especially in predominantly cash- based economies such as Nigeria;
He also said that in recent times, currency management in Nigeria has faced series of challenges that have affected the ability of the Central Bank of Nigeria (CBN) to efficiently carry out its mandate of issuing clean legal tender notes to the general public.
Uba Sani expressed concern that these challenges will continue to grow in scale, with attendant consequences on CBN and Nigeria’s reputation, if left unaddressed.
He said these challenges are primarily centred around the wholesale hoarding of Naira banknotes by members of the public.
“Available statistics show that cash outside banks consist of over 80% of Currency-In-Circulation (CIC). As at end of June 2022, available data indicated that N2.72 trillion out of the N3.26 trillion currency in circulation, was outside the vaults of commercial banks across the country”
Similarly he argued that recent developments in photography and computer technology as well as printing devices, have made the production of counterfeit money relatively easy, thereby increasing the potential threat.
“In recent years, the Bank has recorded a consistent rise in incidences of counterfeiting of the Naira, with the N500 and N1000 denomination banknotes most attacked. The threat to counterfeiting of the two denominations is a function of the large margin between costs of counterfeiting and gains derivable from the criminal act”
He observed that the redesign of some of currency notes will help bring in currencies that are outside the banking system into the banking system thereby making monetary policy more efficient,
halt depreciation of the naira and check the excesses of terror activities in the payment of ransoms.
The Senator encouraged Nigerians and the general public to comply with the Central Bank of Nigeria’s directive to deposit cash holdings at their respective commercial banks.
Bashir Mayere