Governor Of Central Bank-Sanusi, Wants Naira Redesigned

The Governor of the Central Bank of Nigeria, Mr. Lamido Sanusi, on Wednesday made a case for the revisit of the suspended naira redesigning project earlier proposed by the bank.

Sanusi made the case when he appeared before the House of Representatives Committee on Banking and Currency in Abuja....

The committee, which is headed by Mr. Chukwudi Jones-Onyereri, had invited Sanusi to explain the source of the fake naira notes allegedly being dispensed by the Automated Teller Machines of some commercial banks.

The CBN boss said the idea of the redesigning and restructuring of the naira was to change its outlook and make it difficult for criminals to counterfeit different denominations of the currency.

However, he said the bank came under pressure to drop the project earlier this year, following the uproar generated by the planned introduction of N5,000 note denomination rolled into the project.

Sanusi stated that the global practice was for countries to redesign their notes after a few years in order to beat counterfeiters.

He explained further, “One of the reasons we wanted to have a restructuring of the redesign of the currency a few months ago was because, as explained, many of our notes have been in existence for upward of eight or even 10 years.

“Now, the best practice is that within a period of five to eight years, you redesign the currency, because after that period, counterfeiters tend to catch up.”

He, however, told the lawmakers that counterfeiting was still low per one million notes in the country.

“Even at that, Nigerian notes, in terms of what we see as counterfeit and processing, the percentage is very low. We had about 3.9 pieces per one million notes in 2007; six pieces in 2008; 8.4 pieces in 2009; 7.4 pieces in 2010; 5.4 pieces in 2011; and 8.4 pieces in 2012 of the notes processed were counterfeit,” Sanusi explained.

In the case of ATMs, he said it was “rare” for the machines to dispense fake notes.

Sanusi argued that ATMs were fitted with censors and processors designed to detect fake currencies.

“But with ATMs, it should not happen because they have been processed and we will be very pleased to know if there are specifics about any bank so that we can draw their attention on the importance of processing the notes before putting them in the machines”, he added.

To address issues surrounding counterfeiting, the CBN governor said the solution lay with naira redesigning and restructuring.

He added, “Unfortunately, the redesign suffered because of all the noise around N5,000 note, and therefore, it is being delayed because that is what would have made it impossible for counterfeiters.

“They have to wait for another five, six or seven years before they learn how to counterfeit (new designs), by which point the CBN should be redesigning the notes again.

“So, I suppose that at some point, the country will have to revisit the issue of redesigning the notes, but at the moment, based on popular demand, we have had to step down the redesign.”

On calls for lower interest rates, Sanusi ruled out the possibility of that happening soon.

“The likelihood of interest rates coming down in the current environment is not feasible. In fact, it is likely to go up,” he argued.