The Central Bank of Nigeria (CBN) yesterday disclosed that about N7 billion out of its total cost of printing currency will be saved annually with the proposed introduction a N5000 banknote.
Director, Corporate Communications Department, CBN, Mr. Ugochukwu Okoroafor, said this during a media briefing in Lagos.
Under the CBN's initiative, the planned introduction of N5, 000 banknote as the highest naira denomination has been widely condemned. With the proposed new currency structure expected to be officially launched early next year, the existing denominations of N50, N100, N200, N500 and N1, 000 are to be redesigned with added security features. A 12-new-currency structure is expected to emerge at the end of the exercise.
However, Okoroafor also pointed out that unlike in the past whereby printing firms held the patent and right to produce the country's currencies, the latest move would make the CBN hold the patent of the new set of currencies that would emerge from the process.
"We need to take back all our patents and right. Right now, some of the patents and right do not belong to Nigeria or the CBN. We had a rude shock when that became an issue when we wanted to print a particular set of notes. So we are using this exercise to take back that right. If it belongs to Nigeria, nobody will hold us to ransom," he explained.
He also faulted a media report (not THISDAY) that the apex bank would spend N40 billion on the currency review, saying "that is an absolute lie. We are going to publish those figures this week and make the amount available to Nigerians."
"No firm has been given the contract. There is a process because you have to understand the volume you want to print, the security features and it is a long process," he declared.
Okoroafor added: "Every currency gets reviewed once in a while. Right now, the United Kingdom is reviewing its currency. So currency review is something that we must do.
"As a monetary authority, it is our responsibility enshrined in the CBN Act 2007. We believe that given our record in the market and the things that we have done in the past 20 years, we need to be trusted.
"In a world where people are always discovering things, you must ensure that you put the latest technology in your currency. If you don't embed it in your banknotes, the counterfeiters will take advantage of it. You must make sure that the features you put in your currency are so expensive that it will difficult for counterfeiting to thrive. That is what every nation does."
The CBN's spokesman who argued that the project does not contradict the cash-less policy, insisted that the N5000 note will lead to reduction in currency management cost. This according him is the idea behind the cash-less policy.
Okoroafor also dismissed the insinuation that the process would lead to inflation, saying that "we are not increasing the overall money supply."
Continuing, he said: "We believe that coins are very important. There is no society that operates only on banknotes. People say they can't carry coins, but the moment they go to other countries, they give them coins and they put them in their pocket.
"I tell you that it is market forces that will determine what is popular. If you bring a particular denomination that the market does not want because it doesn't fit into the structure, it will die.
"But are there people for whom the N5000 note will be useful to? If the answer is yes, don't we at the CBN have right to serve them?"