Fears Over The CBN’s Plans To Redesign Banknotes Cause The Naira To Drop Further

On Saturday, October 29, 2022, the naira reached a record low of N800 to the dollar before the Nigerian currency plummeted less than 24 hours later.

On Sunday, October 30, 2022, it was reported that black market traders in the Lagos neighborhoods of Ogba, Ikeja, and Allen Avenue traded naira for dollars at a rate of N865, and in some cases, N870.

Naira is pursuing the dollar in excess. Dollars and other foreign currencies are allegedly in short supply, according to black market traders.

The operators claim that there is an oversupply of local currency in the market, which is causing an hourly value drop for the naira. “Although we lack dollars, we currently have adequate naira.

If you cough right now, I’ll give you N1 million, I can assure you that “Ishaya Abdul said on Sunday. Many people, according to him, bring their cash to swap for dollars.

Abdul’s statement supports the experts’ prediction that the CBN’s plan to revamp the naira will cause the currency to plummet even more as hoarders convert their funds to dollars in order to avoid being caught off guard by the bank’s plans.

According to Bloomberg, on Friday, October 28, 2022, two days after the Central Bank of Nigeria announced plans to redesign naira notes, the value of the Nigerian currency against the dollar plunged to a historic low.

Before recovering some ground, the naira on the official market dropped to a record low of N442.62 to the dollar. As of 3:41 p.m. local time, the naira traded from N787.9 to the cryptocurrency USDT to N780 to the dollar on the parallel market, popularly known as the black market.

The N200, N500, and N1,000 notes will be redesigned by December 15 according to the CBN, which made the announcement on Wednesday, October 26, 2022. The CBN claims that the action will reduce money hoarding, security, counterfeiting, and inflation in Nigeria.

READ MORE: Naira Redesign: Why CBN Should Bar Personal Domiciliary Accounts – Economist Speaks

The National Domestic Card Scheme is being used by CBN and NIBSS to converge payments.

To improve Nigeria’s payment system, the Central Bank of Nigeria (CBN), the country’s top bank, and the Nigeria Inter-Bank Settlement System (NIBSS), which includes the Bankers Committee, would introduce a national card program.

According to Vanguard, Premier Owoh, the Managing Director of NIBSS, said this during the Committee’s meeting on October 20, 2022. The proposal, according to Owoh, has been approved and was conceived by CBN.