Governor of Central Bank of Nigeria (CBN), Mallam Sanusi Lamido Sanusi last week said the apex bank would revisit the controversial currency notes redesign to help tackle growing cases of fake currency notes in the country.
Sanusi who spoke when he appeared before the House of Representatives Committee on Banking and Currency also ruled out the likelihood of interest rate coming down. Rather than banks reducing interest rates, he said such rates would likely climb higher. Interest rate currently stands at between 17 and 25 percent.
He equally revealed that Excess Crude Account went down by $7 billion dollars, stressing that the Federal Government was taking money from the account to balance the 2013 budget.
The CBN boss said the hue and cry over the introduction of N5000 notes and redesign of naira notes planned by CBN last year was uncalled for, insisting that the country must revisit the redesign of the notes, which, he said, had lasted between eight to 10 years if fake currency notes in the system must be addressed.
According to him, 8.4 percent of notes in circulation were fake in every N1 million notes, describing the situation as alarming.
He said, “one of the reasons we wanted to have a restructuring of the redesign of the currency a few months ago was because many of our notes had been in existence for upward of eight or even 10 years, but the best practice is that within a period of five to eight years you redesign the currency after which counterfeiters tend to catch up with.
“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 percent in 2007, 6 percent in 2008, 8.4 percent in 2009, 7.4 in 2010, 5.4 in 2011 and 8.4 percent in 2012 of the notes processed were counterfeit.”
On the report that some banks’ ATMs were dispensing fake naira notes, Sanusi said, “with ATM machines, it should not happen because it has been processed and we would be very pleased to know if there are specifics about any bank so that we can draw their attention on the importance of processing them before putting them in ATM machines.”
Sanusi noted that CBN’s plan to redesign naira notes suffered because of all the noise around N5,000 note and therefore it was being delayed because that is what would have made it impossible for counterfeiters to cook so they have to wait for another five, six, seven years before they learn how to counterfeit, by which point, the CBN should be redesigning the notes again.
“So I suppose that at some point the country would have to revisit the issue of redesigning the notes but at the moment, based on popular demands, we had to step down the redesign.”
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