Penultimate Wednesday, President Muhammadu Buhari unveiled the new naira redesigned by the Central Bank of Nigeria (CBN), IgbereTV reports
The redesigned naira was received with mix reactions. Many expressed their disappointment via Twitter, as they did not see the expected major changes in the new outlook, while some said the new naira is more about improving its security and not appearance.
But looking away from the mixed reactions – since the CBN can’t afford to go back to the drawing board due to the criticism – the most important debate now is, how does the new naira affect Nigerians and the economy?
Why the naira was redesigned?
There are two major reasons the Central Bank of Nigeria (CBN) redesigned the naira notes; to recover money outside the financial system and improve the naira’s security.
Recovery of naira: The governor of the central bank, Godwin Emefiele, had complained about the volume of naira notes outside the commercial banks.
Emefiele said there was N2.7 trillion notes that the banks can’t account for, out of N3.3 trillion notes in circulation. The CBN said only N600 billion was in banks’ vaults. So the new naira would force Nigerians into depositing the old currency to the banks.
Security measure: There were claims that the old naira notes were easy to replicate. And according to President Buhari, the new naira notes have been fortified with security features that make them difficult to counterfeit.
Cost of printing, is it really worth it
According to financial analyst, Kalu Aja, the cost of redesigning the naira was N280 billion. This means each Nigerian contributed about N1,296 to the creation of the new naira, based on the population of 216 million.
Based on what was unveiled last Wednesday, it almost seemed like water in s basket, but since the reason for the change was to recover hoarded naira notes and reduce replication of the notes for fraudulent activities, the funds invested cannot be ruled as a waste
