CBN Orders Banks to Accept and Dispense Old Naira Notes as Legal Tender

The Central Bank of Nigeria has recently given a directive to commercial banks to dispense and receive old naira notes as legal tender across the country. This decision was made during a Bankers’ Committee meeting on Sunday and was announced on Monday by the acting Director of CBN Corporate Communications, Isa AbdulMumin. The decision was made in compliance with a Supreme Court ruling made on March 3, 2023.

The ruling ordered the CBN to extend the use of old banknotes until December 31, 2023, due to the negative impact of the policy. The court found that President Muhammadu Buhari’s directive to the CBN on the withdrawal of old notes and redesign of new banknotes without proper consultation was invalid. The CBN initially refused to comply with the order, which led to frustration among Nigerians who were unable to access their money.

However, the Presidency later clarified that the President did not instruct the CBN governor, Godwin Emefiele, and the Attorney-General of the Federation, Abubakar Malami, to disobey court orders. This led to the CBN issuing a statement titled “Old N200, N500, and N1,000 banknotes Remain Legal Tender – CBN,” in which the bank directed all deposit money banks operating in Nigeria to comply with the Supreme Court ruling.

The statement read, “In compliance with the established tradition of obedience to court orders and sustenance of the Rule of Law Principle that characterized the government of President Muhammad Buhari, and by extension, the operations of the Central Bank of Nigeria, as a regulator, Deposit Money Banks operating in Nigeria have been directed to comply with the Supreme Court ruling of March 3, 2023.

“Accordingly, the CBN met with the Bankers’ Committee and has directed that the old N200, N500 and N1000 banknotes remain legal tender alongside the redesigned banknotes till December 31, 2023.

Consequently, all concerned are directed to conform accordingly.”

The directive ensures that old N200, N500, and N1000 banknotes will remain legal tender alongside the redesigned banknotes till December 31, 2023. This decision will come as a relief to bank customers who have been struggling to access their money due to the phasing out of old banknotes.

The state governments, which sued the Federal Government on the naira redesign policy, have given the Attorney-General of the Federation and Minister of Justice, Abubakar Malami, SAN, and the Central Bank of Nigeria Governor, Godwin Emefiele, till Tuesday to comply with the order of the Supreme Court on the currency.

In conclusion, the directive by the CBN to commercial banks to dispense and receive old naira notes as legal tender is a significant decision that will ease the frustration of Nigerians who have been unable to access their money. The CBN decision to comply with the Supreme Court ruling ensures that the Rule of Law Principle is upheld, and the government of President Muhammadu Buhari remains obedient to court orders.