Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), has reiterated that the ₦100 and ₦200 notes are still legal tenders in Nigeria.
But he attributed the shortage of lower denomination notes to the increasing use of digital payments and changing factors of currency demand and supply.
Cardoso made the submission on Tuesday while speaking after the Monetary Policy Committee (MPC) meeting in Abuja, it was reported.
“The CBN has not withdrawn any denomination from circulation,” he said, urging Nigerians to continue to accept the ₦100 and ₦200 notes.
“Yes, they are still legal tender. “Note that all other denominations remain legal tender until the central bank says otherwise.
“As to why there seem to be fewer of these notes in circulation, it is largely a matter of demand and supply. The financial ecosystem is moving in the direction we want it to, with more financial inclusion and more digitisation.
“As people increasingly turn to digital payment channels, the demand for coins and lower denomination notes naturally drops. “If there is less demand for them, there is less need to print and circulate them in large quantities,” Cardoso said.
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He also said the declining purchasing power of the lower-value notes has contributed to their reduced use.
“Certainly, we must also recognise that currency devaluation has impacted the purchasing power of lower-value notes. That is a fact.
“But more importantly, as financial inclusion grows and digital payments become part of daily life, fewer people will depend on these denominations,” he said.
Tendencies of Inflation
The CBN is committed to achieving single-digit inflation despite external shocks that have slowed the pace of disinflation, Cardoso said.
He said Nigeria should be able to achieve the single-digit inflation target by 2027.
‘It is important to remember where we’re coming from. “We had 11 months in a row of disinflation and all indications we were on the path to single-digit inflation where we wanted to be by early 2027 in terms of inflation,” he said.
“Unfortunately, we have suffered external shocks that were not predicted and have lasted much longer than anyone expected.
“We are committed to the single-digit inflation target,” he said.
