The Central Bank of Nigeria ,CBN, has instructed all its branches nationwide to continue issuing various denominations of both old and redesigned banknotes in ample quantities to deposit money banks.
This decision comes in response to reports of cash shortages in major cities.
The CBN emphasized that every banknote issued by the central bank remains legal tender and should not be rejected by anyone, as stipulated in Section 20(5) of the CBN Act, 2007. This move is aimed at ensuring there are sufficient banknotes for normal economic activities.
Legal tender is a type of currency that is accepted by courts as full payment for any financial obligation.
The definition of legal tender varies by jurisdiction, but generally speaking, it is anything that, when offered (or “tendered”) in settlement of a debt, erases the debt.
The statement partly read: “For the avoidance of doubt, while reiterating that there are sufficient banknotes across the country for all normal economic activity, we wish to state unambiguously that every banknote issued by the Central Bank of Nigeria remains legal tender and should not be rejected by anyone, as stipulated in Section 20(5) of the CBN Act, 2007.
“Accordingly, branches of the CBN across the country have been directed to continue to issue different denominations of old and redesigned banknotes in adequate quantities to Deposit Money Banks for onward circulation to bank customers.
“We wish to restate that all denominations of banknotes issued by the CBN remain legal tender. In line with Section 20(5) of the CBN Act, 2007.
“No one should refuse to accept the naira as a means of payment”.
The CBN advised the public to accept all CBN-issued banknotes currently in circulation and guard against panic withdrawals.
“We reaffirm that there is sufficient stock of currency notes to facilitate normal economic activities. Furthermore, to reduce the pressure on the use of physical cash, members of the public are again advised to continue to embrace alternative modes of payment”, it added.