Open branches weekend, expect clearer directive todaylPoS operators ignore CBN warning on selling banknoteslExperts in divergent view on implementation, impact
The banking industry was in disarray over implementation of the directives of the Central Bank of Nigeria, CBN, on collection of the old banknotes in the denominations of N500 and N1,000 during the weekend.
The apex bank was said to have directed the banks to collect the old banknotes which it had declared non-legal tender with effect from February 10,2023, prompting the banks to not only issue mails to customers to come and deposit their old notes but actually began to collect the old notes. The commercial banks also sent out emails to their customers on Friday, re-opening their branches last Saturday after suspending weekend banking previous weekend with the deadline of old notes acceptance.
However, with a statement from the CBN late Friday denying the alleged directive to collect old notes, some of the banks suspended the collection of old notes while others did. Also some of the banks failed to re-open while a few did.
Meanwhile, despite President Muhammadu Buhari’s directive that the CBN should re-circulate the old N200 notes, the operators in the financial system weekend indicated that the situation will persist throughout this week into next two weeks, and may only begin to ease after the elections.
The anger and frustrations among banks customers across the country continued as many of them are locked out of bank premises, just as most Automated Teller Machines, ATMs, remain without cash.
Only branches located in complexes such as hotels, or large malls with tight security operated freely. Almost all stand-alone branches were locked to customers.
Some banks sent armed security personnel to their gates to either turn back customers by telling them that the bank is not open for customers or screen customers who had other transactions apart from withdrawing cash.
However, others completely closed for fear of being attacked for failing to provide the new Naira notes.
Besides cash deposits, other customers were either making transfers or cheque deposits.
For some banks, their ATM galleries were shut to the public.
Financial Vanguard also discovered a surge in the number of customers requesting debit cards and those seeking assistance to sign up to the banks’ Mobile Apps as the customer care sections were overwhelmed with crowds.
Major markets and shops in Lagos shut down activities last Friday due to crisis emanating from inability to spend the old N500 and N1,000 by Nigerians still in possession of the old naira notes.
Market traders were divided as some traders were collecting the old N500 and N1,000 at a cost by increasing the prices of their wares while others rejected them.
As a result of the confusion among Nigerians, most commercial drivers parked their vehicles, making commuters stranded at the bus stops, even as available transporters increased fare prices.
Old/new notes confusion spreads
There was also confusion across the country over the weekend as the extended deadline for the return of old N500 and N1000 notes lapsed.
The CBN had announced that it would receive the affected notes until February 17, 2023, after which they would be required to undergo certain processes before going to the CBN to have the old notes accepted for deposits.
However, Financial Vanguard learnt that some members of the public who went to the apex bank to deposit their money were turned back, apparently due to their inability to fulfill the requirements.
The reason advanced by CBN staff was that only depositors with N500,000 and above were to take their old notes to CBN. Those with less were asked to take their old notes to their banks.
At the Deposit Money Banks (DMBs), however, there was confusion as some banks refused to accept such deposits, while others did.
Financial Vanguard learnt that the confusion emanated from the CBN’s conflicting communications.
Virtually all DMBs had stopped accepting deposits of old notes since February 10, 2023.
In the midst of the confusion and anger, some DMBs issued memos to their customers who had the affected old notes to come forward and deposit them.
Before the close of work, whoever, that position was countered by a CBN statement, which denied any directive, asking members of the public to continue to deposit their old notes with their banks.
Bank customers, Friday, flooded the banks to deposit their old N500 and N1,000 notes following news that the Central Bank of Nigeria (CBN) had directed Deposit Money Banks to resume collection of the old notes.
Findings also showed that some businesses, including Point of Sales, PoS, operators and transporters still collected the old notes while others rejected them.
For commercial buses some operators said to passengers: “If you don’t have the new notes, don’t enter the bus.” Some others didn’t make any prior announcement and they collected both new and old notes.
A PoS operator in Ojuelegba bus stop, in Lagos, told our correspondent, “It is not quite long that we received information that we can collect the old N500 and N1,000 and take to our bank after we have filled a form the Central Bank of Nigeria, CBN has on its website. We are collecting it. Only that the CBN has said we must not deposit more than N500, 000.”
But most traders were not aware of this development as they had shut down earlier.
A trader in one of the markets in Lagos Island, Mrs. Grace Faleke, said the shops were locked by some traders out of fear of unrest going on at Mile 12 and Ojota areas of Lagos, adding that the market entrance were locked because some people who brought old notes to purchase goods and were refused threatened to fight.
She added that the rioting and fighting at Mile 12, Ojota and other places made some of the shop owners to close down and go back home.
Faleke said: “We have heard that they are fighting in different locations in Lagos, so as a result, most of the traders locked their shops and went home.
-Vanguard
