Why naira notes were redesigned [Pulse Explainer]

President Muhammadu Buhari unveiled the newly redesigned N200, N500 and N1,000 banknotes at the presidential villa today, November 23, 2022; earlier than the December 15, 2022, date that was previously announced.

How Nigerians felt about the change: Since the announcement of the change of naira notes, many Nigerians have criticized the idea; saying, it will not necessarily benefit the economy in any way. However, it till zap money out of the system as it costs a lot to print new currency notes.

How much is CBN spending to print new naira notes: N75. 52 billion was spent on printing new naira notes in 2019; and N58. 07 billion in 2020 respectively. However, the apex bank is yet to disclose what it'll cost to print and circulate the new notes.

Why is CBN making new notes

The CBN governor said the introduction of new notes was a deliberate step by government to check corruption and counterfeiting of the notes.
He said the development was also aimed at checking worsening shortage of clean and fit currency, with the attendant image problem for the central bank.
Emefiele said there was significant hoarding of naira notes by members of the public, with statistics showing that over 80 per cent of the currency in circulation were outside the vaults of the commercial banks. He said as of September 2022, a total of N3.2 trillion was in circulation, of which N2.73 trillion was outside the vaults of the banks, describing the development as unacceptable.

The benefit we all needed to know: According to a Bloomberg article, the change of the bank notes allows the government to collect the money that is widely distributed in the market and helps control inflation.

How Nigerians are reacting to the new naira notes: Many have expressed a fall in expectation, as the new naira notes maintain the same design but different colours from the old notes.

What really matters: While aesthetical expectations were not met, all eyes should focus on the inflation numbers in the next few weeks... Would CBN's strategy help reduce inflation rate, or flop?