Banks ration cash while fuel stations and others refuse outdated bills

Okechukwu Nnodim, Opeoluwani Akintayo, Edidiong Ikpoto, Funmi Fabunmi, Damilola Aina, Deborah Dan-Awoh, Lilian Ukagwu Oluwakemi Abimbola, Lilian 

Ukagwu, and Josephine Ogundeji

Some Deposit Money Banks' new initiative to re-circulate old N500 and N1,000 notes was thwarted on Tuesday when motorists, fuel stations, retailers, traders, and other bank customers rejected the old currencies.

The development came about 48 hours after some commercial banks, particularly Guaranty Trust Bank Plc, Zenith Bank Plc, and Sterling Bank, began disbursing the controversial N500 and N1,000 notes across their branches in major Nigerian cities.

The commercial banks' decision to re-circulate the old notes followed last week's Supreme Court order approving the use of old N1,000, N500, and N200 notes as legal tender for 10 months.

Last Friday, the Supreme Court ruled that old naira notes should be permitted to circulate alongside new notes until December 31, 2023. 

The Federal Government's naira redesign policy, according to the court, violated the 1999 Constitution.

However, The PUNCH discovered on Tuesday that key bank customer groups have begun rejecting re-circulated old N500 and N1,000 notes. 

Except for the old N200 note, most of them based their arguments on the fact that the CBN, the banking sector regulator, had yet to approve the use of the old notes as legal tender.

On Tuesday, oil marketers in Abuja, Nasarawa, and Niger states refused to collect old N500 and N1,000 notes from customers, claiming that Deposit Money Banks had yet to instruct them to accept the old naira bills. 

Despite the Supreme Court and the Central Bank of Nigeria's orders, some filling stations, particularly those operated by independent oil marketers and the Nigerian National Petroleum Company Limited, refused to accept the old naira notes on Tuesday.

Attendants at the NNPC Limited's retail outlet in Nyanya, a major border town between Abuja and Nasarawa State, said they had yet to receive instructions from their superiors about accepting the old notes.

Similarly, at the Khalif filling station in Kubwa, Abuja, operated by an independent marketer, attendants said they would not accept old naira bills and instead asked customers to pay with a Point of Sale Service machine or via bank transfers. 

Aside from filling stations, most merchants in the capital city and neighboring states had yet to begin accepting the old notes.

"We're awaiting the presidential directive. The President has yet to speak. "However, if the banks say we should collect the old notes, of course, we will accept the notes," said Mohammed Shuaibu, Secretary, Independent Petroleum Marketers Association of Nigeria, Abuja-Suleja.

“ "However, as of now, we have received no official confirmation," he added. We are only hearing it from individuals. I can assure you that once the banks tell our members to accept it, we will gladly comply. 

"We are hearing that the banks have started giving out the old notes, but as for me, I've not set my eyes on the old N500 and N1,000 notes till this minute that I'm speaking to you. We're only hearing about it." 

Shuaibu acknowledged that marketers were aware of the Supreme Court order, but insisted that it was a presidential directive to the CBN that the old bills be returned to the banks. 

"Well, if they've agreed that the money should be paid, as marketers, we want the economy to thrive and are willing to collaborate. But, as of now, I don't believe banks have instructed their customers to bring the old notes. 

"I haven't heard about it, and I haven't seen it, because I don't know where they're going to make the money, because we were told that the presidential directive was that they destroy the old notes," said an IPMAN official.

Lagos and Ogun drivers 

Moreover, despite the Supreme Court's order, petrol stations and commercial buses in Lagos and Ogun states refused to accept old naira notes as payment.

Several petrol stations in Ogun and Lagos rejected old N500 and N1000 notes from customers, while only accepting old N200 notes, new notes, Point of Sale payments, and transfers. 

The PUNCH witnessed several fights between filling station attendants and motorists over the old N500 and N1000 notes. Customers with old notes were left stranded by station attendants who refused to dispense gasoline to those in possession of the old notes.

Passengers were also left hanging at major bus stops across the two states because most commercial bus drivers refused to accept the N500 and N1000 notes because filling stations had yet to begin accepting them when purchasing petrol for their businesses. 

The old N500 and N1000 notes were rejected by a commercial bus traveling the Berger-Mowe axis. 

Traders strike 

Furthermore, several traders had yet to accept the old N500 and N1000 notes. 

Checks by our correspondents around Ogun State's Alagbole-Akute axis revealed that motorists, traders, and supermarkets refused to accept the old naira notes due to confusion about the currency's status as a valid means of exchange.

According to a trader who identified herself as Bukola Vivian, the reason for the rejection of the old naira notes is that Nigerians prefer to listen to CBN directives rather than court rulings. 

"Ever since this naira thing started, people have listened to what the CBN says, and now the CBN has not said the old notes should be accepted," she said. If I collect old notes now, I won't be able to give them out as change because other people will reject them."

Ojodu Abiodun, a Sales Manager at JustRite Supermarkets who did not want to be identified, told The PUNCH that the retail giant was also refusing to accept the old notes. 

"The truth is that not many people have even brought the old notes," the source said. Many of the customers here pay with their credit cards. For the time being, we don't know what the status of the old notes is, so it wouldn't be prudent to begin accepting them from customers." 

Transport operators along the axis refused to accept old notes from commuters, insisting that payments be made in new notes or via transfers. 

Market women in Magboro, Ogun State, also rejected the new notes.

"I can't collect the old notes because Buhari hasn't said anything," a trader identified only as Iya Sola said. The last time they (the Supreme Court) said we should collect it, and we did, it was because of what Buhari said, and I can't run at a loss."

Ireti Shobowale, another market woman, said she was still waiting for the president's directive to decide whether or not to accept it. 

Moreover, despite the Supreme Court's order, traders and motorists in the Federal Capital Territory refused to accept old N500 and N1,000 notes from customers. 

Ndubuisi Egbo, an Abuja taxi driver, said he refused the old notes from two passengers because he wasn't sure anyone would accept them from him. 

Similarly, a corn seller simply stated that she would not accept the old notes unless the CBN issued a directive on the subject.

SMEs criticize the CBN 

Meanwhile, Dr Adams Adebayo, Chairman of the Nigerian Association of Small and Medium-Scale Enterprises, lamented the situation. 

"It's disheartening that, despite the Supreme Court's pronouncements on Friday, March 3rd, 2023, traders and the general public are still rejecting the old N500 and N1000," he said. Many businesses, particularly gas stations, are refusing to accept the old notes.

Banks are now issuing old notes, which the public is rejecting because there have been no pronouncements from the apex bank. The banking system appears to have orchestrated a total collapse of the economy with the apex bank's sit down and look attitude." 

Cash is rationed by banks. 

Meanwhile, banks continued to accept the old N500 and N1000 notes on Tuesday. 

The Breezenaija discovered GTB on Zaitech road in Oregun dispensed old N500 to their customers over-the-counter.

In addition, a Zenith Bank branch inside the RCCG Camp in Ogun State, along the Lagos-Ibadan Expressway, disbursed a maximum of N5,000 in old N500 notes to customers. 

In response, Dr. Uju Ogubunka, President of the Bank Customers Association of Nigeria, stated that there were no valid reasons for traders and transporters to reject the old naira notes. 

"They have nothing to worry about. If they aren't convinced that they shouldn't accept them, they can give it to those of us who need it. In any case, they should accept it because the highest court in the land has made a decision. They would have made no decision if no case had been presented to the Supreme Court. However, there was

Thank goodness, some banks have begun dispensing it; if they are dispensing it, it means they will accept it when you return it to them. So, if you go to the market and some people refuse to accept it, you can return it to the bank and not lose anything." 

However, The Breezenaija discovered that several banks had yet to begin disbursing the old N500 and N100 notes. 

This came as the scarcity of the new notes persisted across the country, with long lines at bank branches in Lagos, Abuja, Ogun, and elsewhere. 

Furthermore, The Breezenaija observed that several bank branches remained closed on Tuesday, citing a lack of cash.

In addition, our correspondents who visited bank branches in Mazamaza and Oshodi on Tuesday noticed a large crowd of customers at the entrances to the banks. 

Only those with transfer issues were given numbers and allowed into the banking hall at Fidelity Bank and Zenith Bank branches along Old Ojo Road. 

Tanimola Sunday, a Fidelity Bank customer, said she went to get a number as early as 6:49 a.m. and was given number 70 at the bank's branch on Old Ojo Road.

"I got there at 6:49am and met some people who were already waiting," she explained. I was given the number 70 when I asked for one. I was taken aback. My motivation for leaving early had been defeated. I only have a complaint about a transfer." 

PoS operators are irritated. 

Victor Olojo, National President of the Association of Mobile Money and Bank Agents in Nigeria, condemned the CBN decision. 

"AMMBAN is deeply disturbed by the issues surrounding the low acceptance of old naira notes despite the Supreme Court ruling," Olojo said.

"The CBN's silent posture is largely responsible for this. The CBN has yet to give or issue a clear directive to the country's financial institutions. Remember that the CBN regulates and controls the financial sector and currency matters. 

"As a result, the CBN must demonstrate respect for the Supreme Court ruling by issuing a directive to all FIs to accept and issue out old notes, while also assuring Nigerians that the old notes will be accepted as legal tender until the time specified by the Supreme Court." 

Meanwhile, our correspondents observed crowds on several bank premises along Lagos' Ojodu axis. On the axis, Access Bank Plc, First Bank Plc, and Union Bank Plc had branches.

Dr. Musa Muhammad Maitakobi, President of the Road Transport Association of Nigeria, declined to comment on why motorists were rejecting the old notes. 

Meanwhile, some Nigerians have accused POS operators of extorting bank customers. They claimed that PoS agents charged as much as N1,500 for new N5,000 notes.

According to a customer, Mr Kunle Solola, the CBN and the Economic and Financial Crimes Commission should go after fraudulent PoS agents who extort Nigerians. 

Another bank customer, Kemi Adebola, stated that she had paid over N50,000 in charges to PoS operators in the previous two weeks, claiming that the Federal Government could not afford to continue allowing PoS agents to extort Nigerians. 

"With the new notes, POS agents and bank officials are engaging in racketeering. They sell new notes to helpless customers at exorbitant prices. This cannot go on.