World Bank reveals setback in Nigeria’s Naira redesign policy

The World Bank has advised Nigeria that the transition period of the naira redesign initiative by the Central Bank of Nigeria, CBN, is short and would harm the country’s economy, especially the poor.

The bank stated this in its recent Nigeria Development Update, NDU, report ‘Nigeria Choice’.

Recall that the CBN has commenced the circulation of the newly redesigned N200, N500, and N1000.

Reacting to the policy, the World Bank disclosed that rapid demonetisations birth short-term costs for small businesses, and vulnerable households, especially Nigerians relying heavily on daily cash transactions.

It added that many homes and firms face financial pressures orchestrated by inflation, floods, fuel price shocks and the ongoing phasing out of old naira notes.

“While periodic currency redesigns are normal internationally, the naira does appear to be due for it since naira notes have not been redesigned for two decades. However, the timing of and short transition period for this demonetisation may have negative impacts on economic activity, particularly for the poorest households,” it stated.