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Nigeria: New Coins Coming Soon

Started by Bimat, February 15, 2012, 02:05:09 PM

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Bimat

New coins coming

By Akinola Ajibade

Coins will soon stage a comeback, according to the Central Bank of Nigeria (CBN).

But they will be repackaged and made more attractive.

The plan is coming on the heels of the refusal of banks' customers, traders, motorists and food vendors, among others to accept 50 kobo, N1 and N2 coins.

CBN spokesman Mr Mohammed Abdullahi said the apex bank is adopting measures to make coins an attractive legal ,adding that the top echelon of the bank has been fine-tuning policies that would encourage the use of coins.

He said: "CBN is making arrangements to make coins attractive. It is a decision Nigerians must abide with. I cannot say what strategies the management of CBN is putting in place to make coins appealing. It is a policy issue which I cannot speak on. All I know is that coins will regain acceptability soon."

Earlier, the CBN's Governor, Mr Sanusi Lamido Sanusi said the paex bank will soon roll out measures that will increase the availability and general acceptability of coins as a medium of exchange in the country. Sanusi said efforts will be geared towards improving the image of the smallest denomination of the nation's medium of exchange.

He said the issue of re-packaging coins is an on-going process, adding that the issue goes through the presidency and the board of the CBN. He said CBN is aware that Nigerians want to use coins, stressing people would hear from apex bank soon.

He said: " Certainly, we are aware that Nigerians will like to see the use of coins and that is the reality. You will hear something from us in that respect in the next few weeks. It is an on-going process and obviously, these are things that go through the presidency and the Board of the CBN. So, very soon you will hear something about coins."

It would be recall that CBN directed banks to pay two per cent of all withdrawals in coins to ensure availability in the system.

Subsequently, it ordered banks last year not to accept coin deposits from the public until further notice, the essence of which was to encourage their circulation. But that has yielded little results.

In the last two decades, CBN has carried out some reforms in the management of the local currency in naira and kobo. When the government of General Yakubu Gowon indigenised the currency, from the British pounds shilling, he introduced what came to be known as naira and kobo in 1973. The currency was greeted with acceptance by Nigerians. It automatically became the legal tender and was high in value against the United States dollar and the British pound sterling.

Source: The Nation
It is our choices...that show what we truly are, far more than our abilities. -J. K. Rowling.

Enlil

It doesn't help that the coins are worthless for buying anything. Also the Nigerian buying habbits would be different than in the west because of the different economies and distribution of wealth. Maybe make upt to 50 Naira, then they would circulate.

Bimat

CBN To Introduce N5000, N2000 Notes; N50, N20, N10 Coins

Sun, 13/05/2012 - 2:34am | SHUAIB SHUAIB

In an attempt to reduce the volume of cash baggage and security exposure in cash transactions, the Central Bank of Nigeria may be contemplating the introduction of new currency denominations of N2,000 and N5,000.

The bank has also made plans to convert N5, N10, N20 and N50 into coins which are all presently notes.

The policy would make it easier to move large quantities of cash around with little exposure to risk, but financial critics have suggested that it would be a contradiction to the CBN policy to migrate to a cashless economy.

Spokesman of the Central Bank Ugochukwu Okorafor, who spoke to LEADERSHIP SUNDAY, however, said he could not confirm that the bank's governing board was thinking of introducing two new denominations in addition to the existing ones.

Okoraforwho made no outright denial that such a policy was being contemplated, said instead that he had to get further clarification from the bank's leadership. And as at press time yesterday, the CBN spokesman was unable to reach any of the bank's directors.

But a source who is a staff member of the bank told LEADERSHIP SUNDAY, under the condition of anonimity that, "The top management of the CBN have decided to introduce currency denominations of N2,000 and N5,000. This is being done in the best interest of the economy."

The source who could not say when the policy would take effect or when it would be announced to the public said, "All the smaller denominations from the N50 downwards are also to be converted into coins."

A financial expert and executive chairman of the Society for Analytical Economics, Nigeria, Dr. Godwin Owoh, has said that if the policy is carried out, it would not only lead to inflation but would increase the ability to carry out cash transactions.

He said the activities of the CBN were becoming more commercial in nature, suggesting that this was more of a fiscal policy than a monetary one and that it should be decided by either the minster of finance or the president.

Owoh said, "There has been no official pronouncement from the CBN on this policy but, if it is carried out, it will only give the bank's management the capacity to award more contracts, making it a purely selfish and commercial endeavor. The CBN has been carrying out commercial activities, which are normal banking operations – they set rules on how to withdraw or not withdraw money."

He said, " The CBN has invested a lot into the cashless policy and point of sale terminals will suffer; 100,000 units of hardware for e- transactions have been installed in different places.

"The process of printing money is clearly a fiscal issue. Embarking on this policy would indicate a lack of harmony between the fiscal and monetary policies."

Source: Leadership
It is our choices...that show what we truly are, far more than our abilities. -J. K. Rowling.

Figleaf

Introducing high value notes does not cause inflation. At best, you can argue that withdrawing small value coins does that. Printing money is not a fiscal policy issue. The cost are negligible in the totality of the government budget. Central bank commercial activities, if any, have nothing to do with fiscal policy. While fiscal policy feeds into monetary policy, changing from coins to notes or introducing new notes has virtually nothing to do with either fiscal or monetary policy. ::)

I guess Mr. Owoh is the financial expert who keeps sending me emails on how he wants to transfer money through my bank account and let me keep a million. :P

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

Harald

Quote from: Figleaf on May 13, 2012, 01:47:57 PM
Introducing high value notes does not cause inflation.

The other way round, of course. Inflation forces you to carry loads of money with you.
http://www.liganda.ch (monetary history & numismatic linguistics)

Bimat

CBN introduces N5000

By Nduka Chiejina, Abuja

A new currency – N5,000 note – will go into circulation  next year, the Central Bank of Nigeria (CBN) said yesterday.

Three denominations - N5, N10 and N20 – are to become coins.

The 12 currency structure of the naira will now be six coins and six bank notes.

The coins are: N50k, N1, N2, N5, N10 and N20. The banknotes will be in N50, N100, N200, N500, N1,000 and N5,000.

CBN Governor Sanusi Lamido Sanusi who announced the plan yesterday said the new coins and the N5,000 banknote were introduced as a result of "inflationary pressures".

The faces of three prominent Nigerian female activists are to be inscribed on the N5,000 note. They are those of the late politician and social mobiliser, Margaret Ekpo (1914 - 2006);  the late politician and activist Hajia Gambo Sawaba (1933 - 2001) and the late politician and women's right activist Funmilayo Kuti (1900  -1978).

Sanusi said "efforts are being put in place to ensure that the redesigned N50 and the new N5000 banknotes are launched early in 2013."

"There will  be no urgent need for exchange of the old for the new bank notes by the general public for as long as the old banknotes are in circulation, they will remain legal tender," he added.

The CBN helsman also said: "To encourage the usage of coins, the CBN will liaise with relevant MDAs, DMBs, road transport workers, market operators, small businesses, supermarkets, vendors, etc. to create avenues for the usage of the coins. The CBN will ensure that coin collection is convenient and the introduction of the new currency series will be a gradual process as the banknotes will circulate simultaneously with the old series until they are fully withdrawn from circulation."

Many entities collaborated to redesign the new currency series. These include the currency department of the CBN, the Nigerian Security Printing and Minting Company (NSPMC) Plc and competent international consultants.

The vanished lower denomination banknotes failed to adequately meet expected longevity, Sanusi said.

Significant difficulties associated with the processing and destruction (briquetting) of the polymer banknotes, he gave as the reason for the CBN action. "It is important to add that this situation has largely constrained the realisation of the benefits expected from polymer banknotes over paper notes.

"The tactile feature for the visually, impaired on the polymer notes has not been as effective as desired," he said.

He gave other reasons for the introduction of the new banknote, saying:

Higher denomination banknotes would discourage dollarisation, reduce the volume of banknotes and the overall cost of currency management.

Source: The Nation
It is our choices...that show what we truly are, far more than our abilities. -J. K. Rowling.

<k>

Quote from: Bimat on August 24, 2012, 05:14:07 AM
A new currency – N5,000 note – will go into circulation  next year, the Central Bank of Nigeria (CBN) said yesterday.

Three denominations - N5, N10 and N20 – are to become coins.

The 12 currency structure of the naira will now be six coins and six bank notes.

The coins are: N50k, N1, N2, N5, N10 and N20.

Currently the highest denomination of coin is the 2 naira, which is bimetallic. The 1 naira is also bimetallic. Since they will now be among the lower denominations, I doubt they will remain bimetallic.
Visit the website of The Royal Mint Museum.

See: The Royal Mint Museum.

Bimat

I wonder if they actually need any coins, the highest denomination (20 Naira) is worth $0.13 or €0.10...Wikipedia says 45% of Nigerian population lives below poverty level and inflation is 11.9% (2011 est.). May be a good idea to get rid of coins completely?

Aditya
It is our choices...that show what we truly are, far more than our abilities. -J. K. Rowling.

Figleaf

QuoteThe vanished lower denomination banknotes failed to adequately meet expected longevity, Sanusi said.

That's what's was in the poodle, as Dr Faust put it. Whether or not you need coins depends on expected inflation. If you expect it to be low (a bet for Nigeria, with an economy depending on oil and food), coins are cheaper than notes. If you expect inflation to remain high, notes are better.

I don't share the CBN's apparent optimism.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

paisepagal

Quote from: Bimat on August 26, 2012, 04:19:15 PM
I wonder if they actually need any coins, the highest denomination (20 Naira) is worth $0.13 or €0.10...Wikipedia says 45% of Nigerian population lives below poverty level and inflation is 11.9% (2011 est.). May be a good idea to get rid of coins completely?

Aditya

Replace Nigeria with India and naira with rupee, and there's barely any difference
The denomination has to be increased, be it in Nigeria or india... Especially in countries which have 45% of the population under the poverty line making the bulk of very small purchase

Bimat

Seems that the senate has stopped the introduction of N5000 banknote:

Source

Aditya
It is our choices...that show what we truly are, far more than our abilities. -J. K. Rowling.

Bimat

Nigeria's apex bank to spend 40.3b naira to produce new coins, currency notes

The Central Bank of Nigeria (CBN) is to spend 40.3 billion naira (US$249 million) to produce new coins and naira notes, the local media reported Monday, as criticism trailed the planned introduction of the 5,000 naira note, which is the equivalent of about US$31.

The report quoted an unidentified member of the CBN board as saying that most of the new notes and coins would be printed by the Nigerian Security Printing and Minting Company.

However, he said the 5,000 naira note - which will be the nation's highest currency denomination - would be printed by a foreign firm with the necessary technology and the capacity to handle the sensitive features on it.

The CBN had last Thursday announced a comprehensive review of the country's currency and the plan to introduce the 5,000 naira note, as well as to convert the 5, 10 and 20 naira notes to coins.

The new currency regime will come into effect in the first quarter of 2013.

The new coins will join the 50 kobo, 1 naira and 2 naira coins already in existence but which Nigerians hardly use.

Meanwhile, critics of the plan to introduce the 5,000 note have warned that the unintended consequences might outweigh the benefits.

They said the introduction of higher currency notes in an economy often signifies a regime of increased and sustained fiscal deficit financing.

Source: African Manager
It is our choices...that show what we truly are, far more than our abilities. -J. K. Rowling.

Figleaf

If it wasn't for real it would be funny. These people actually seem to believe that deficit financing literally means printing money.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

Bimat

Nigeria's President Goodluck Jonathan halts naira reforms

21 September 2012 Last updated at 12:17 GMT

Nigeria's president has ordered the suspension of plans to introduce a new series of coins and a high-denomination note, following a public outcry.

An advisor to President Goodluck Jonathan said the suspension would give the Central Bank of Nigeria more time to explain why the changes were needed.

The government says using coins for small amounts would save money.

But the BBC's Fidelis Mbah says people do not like coins and fear a high-denomination note will fuel inflation.

The highest denomination note is currently 1,000 naira - worth $6 (£4) - and the government says this makes paying for high-value items difficult.

The government wants to introduce a new 5,000 naira note.

Coins would replace notes for amounts up to 20 naira and there are even plans for cash machines to start dispensing coins, rather than notes.

"The introduction is being suspended for now to enable the CBN to do more enlightenment on the issue," said Mr Jonathan's advisor, Reuben Abati.

Source: BBC
It is our choices...that show what we truly are, far more than our abilities. -J. K. Rowling.

Bimat

#14
CBN, wither the new naira notes, coins?

Monday, 24 June 2013 00:00   

Shortly after assuming duty as the governor of the Central bank of Nigeria (CBN), Alhaji SanusiLamidoSanusi set himself to the task of restructuring the banking sector to make the financial institutions more active.

He changed certain denominations of naira namely, N5, N10, N20 and N50 into polymer notes and he is now proposing to change them into coins.

These must have gladened the hearts of people who had been expecting it to happen considering the usefulness of naira in transacting business.

A careful look at the various naira notes now in circulation especially N5, N20 and N50 will definitely convince anyone that they will need a change by their outlook and texture.

Their surface often look rough while the serial numbers and other inscriptions totally disappearing. Others like N100, N200, N500 and N1000 do same with smelly nature when they are in circulation.

Another disappointing aspect is that the notes often get torn and when mended, many people,  particularly traders often refuse to accept them for business transaction.

Such persons should realise that it is not the fault of the customer. The CBN should be held responsible for the lapses because it is the only institution authorised to issue out naira.

The CBN has the responsibility to accept from commercial banks, bad and mutilated notes in exchange with new ones. But in this case, they often fail; instead, they will pay their customers torn notes.

The action of commercial banks in this regard should be condemned. Nigeria is one of the countries which stand the best in world currency. Why not take that as an opportunity to maintain and maximise the prestige and the leadership role it is playing?

Another prosilient point is the promise made by the CBN to resuscitate coins and make them available for the benefit of the people. As it is now, there is no vestige of coins in the markets and the public generally.

This makes things extremely difficult for people who are in dire need of them. As an example, the least good a person can now buy in the market begins from N5 which, to my mind, should not be because it is one of the causes of inflation which has injected a virus into our economy.

If the CBN can bring back coins into the commercial life of the people, it will definitely solve most of the extant knotty problems arising from non-payment of "part thereof" as salary to workers or "no change sybdrome" common with traders and customers during transactions.

Coins like 1k, 5k, 1k, 25k, 50k and N1 as it was the arrangements in the past would be found auspicious to our wobbling economy. Besides that, coins cannot be diverted from naira because they serve as the springboard.

Source: Tribune
It is our choices...that show what we truly are, far more than our abilities. -J. K. Rowling.