The Central Bank of Nigeria (CBN) has announced that the phased-out process of the N200, N500, and N1,000 old naira notes has commenced, and they are being gradually replaced with redesigned ones. This information was shared by the Acting CBN Governor, Folashodun Shonubi, after the apex bank’s Monetary Policy Committee (MPC) meeting in Abuja on Tuesday.
Additionally, the CBN has raised the Monetary Policy Rate (MPR), which indicates the interest rate, from 18.5 per cent to 18.75%.
Shonubi explained that when currency is initially printed and circulated, it goes through numerous cycles and eventually becomes worn out. At that point, the old notes are taken out of circulation and replaced with new ones. The process involves the collection and processing of the old notes, ensuring they are no longer usable, and then introducing the new notes.
He clarified that the purpose of this initiative is to maintain an optimal level of currency in circulation. The CBN aims to replace worn-out notes with fresh ones, rather than merely increasing the overall money supply.
The transition from old to new notes will take place gradually, without any grand announcement or celebration. Over time, the old notes will be naturally phased out, and the new notes will become the norm.
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