On Monday, some commercial banks in Nigeria resumed issuing the old N500 and N1000 denominations to the public.
The decision follows a Supreme Court ruling that extended the currency’s validity to December 31, 2023.
In a separate event, the Central Bank of Nigeria (CBN) revealed on Monday that total repayments under its Anchor Borrowers’ Programme (ABP) amounted to N503 billion, or 52.39 percent of total exposure.
On the issuing of the old banknotes to customers, THISDAY has learned that the absence of a statement from President Muhammadu Buhari or the apex has created ambiguity, as companies in Abuja and elsewhere continue to reject the old denominations.
With the Supreme Court’s judgement, the central bank has offered no further clarifications or directives, causing the banking public to exercise cautious with regard to the old notes.
THISDAY also learned that some GTBank and Access Bank branches in Abuja distributed the obsolete banknotes. In Lagos, it was reported that Sterling Bank and Access Bank in Iyana Ipaja loaded the old N1000 and N500 notes onto their ATMs, from which consumers withdrew them.
However, the Federal Capital Territory (FCT) remained cash-strapped, as virtually none of the Point of Sale (POS) agents had cash at the time of the check.
A point-of-sale (POS) operator told THISDAY that it was nauseating to spend the day idling at a bank just to receive between N2,000 and N5,000.
The findings also found that many POS operators relied on internet money transfers and conducted few cash transactions.
Experts predicted that cash availability and circulation would significantly improve in the days following the supreme court’s ruling. In addition, they believed that the conclusion of the general election the following week would result in monetary policy measures that would enhance the economy’s cash flow.
Many believe that offering clarity and direction about the court’s verdict would ultimately reduce apathy among the banking public.
In the meantime, the CBN said Tuesday that total repayments under the ABP amounted to N503 billion, or 52.39 percent of total exposure.
Dr. Abdulmumin Isa, acting director of the CBN’s Corporate Communications Department, told journalists in Abuja that the N 119 billion balance was not due for repayment.
The International Monetary Fund (IMF) reported last week that only 24% of loans collected by the ABP from farmers had been repaid. This meant that 76 percent of the loans were still outstanding.
In response to the IMF, however, Isa stated that the CBN remained dedicated to its development finance goal of increasing the real sector’s access to financing.
Isa stated that, as of February 28, 2023, the ABP bank had disbursed a total of N1.08 trillion, of which N960 billion was due for repayment. As of February 2023, he stated that CBN ABP had helped over 4.57 million smallholder farmers cultivate over 6.02 million hectares of 21 crops across the country.
He included rice, wheat, cowpea, millet, maize, cotton, fish, soya bean, chicken, and cassava on the list of commodities.
Additional crops include groundnut, ginger, sorghum, oil palm, cocoa, sesame, tomato, castor seed, yellow pepper, onions, and livestock/dairy products.
Further citing data from the Food and Agriculture Organisation (FAO), the acting director stated that the ABP had significantly contributed to increased national output of focal commodities, with maize and rice reaching their respective peaks of 12.2 million and 9.0 million metric tonnes in 2021 and 2022.
Isa stated that the program has contributed to an increase in the national average yield per hectare of these commodities, with productivity per hectare nearly doubling in the eight years after the program’s inception.
Isa said that beneficiaries made ABP repayments in cash or in kind, and that the remaining loan sum was still under moratorium due to the COVID-19 forbearance granted to beneficiaries by the apex bank’s interventions in March 2020 and extended until February 28, 2022.
Isa elaborated, “It is important to remember that the duration of loans under the ABP is determined by the gestation time of the product. For instance, loans offered to farmers who cultivate certain perennial crops may have terms of up to seven years.
“The CBN is committed to its development mandate of boosting access to credit for the real sector, especially agriculture, as it continues to support the federal government’s food security and economic growth initiatives.
“Accordingly, the CBN continues to accept applications for the Anchor Borrowers Programme from eligible Nigerian farms and businesses.”
Isa said that the central bank’s primary mission of stimulating the productive base of the economy continues to encourage investments in capital assets in sectors with strong growth and employment-elastic potential via its various interventions.