20 March 2024

Public Interest Litigation, Citizens' Rights And 'Regulatory Irresponsibility': Periscoping The Central Bank Of Nigeria's Q1 2023 Currency Change Exercise

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The recent debacle that the CBN's currency change just around Nigeria's 2023 general elections represented, the magnitude of avoidably huge (and in some cases irreparable) losses, the untold...
Nigeria Finance and Banking
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(LeLaw Business and Society Series No. 1) December 2023

"Ubi jus, ibi remedium" (Where there is a wrong, there is a remedy) - Legal maxim

"(b) the security and welfare of the people shall be the primary purpose of Government" - Section 14(2)(b), 1999 Constitution

"Furthermore, State parties may also not ipso facto, use their public status to overreach or bully their contractual counterparts, or regulated entities just by that fact of regulatory oversight cum power, alone."

- Afolabi Elebiju1


The recent debacle that the CBN's currency change just around Nigeria's 2023 general elections represented, the magnitude of avoidably huge (and in some cases irreparable) losses, the untold hardship suffered by citizens as a result thereof; and heated discussions within this author's professional circles whether or not citizens should be entitled to any relief for such losses and hardship, gave rise to this article. This author was of the view that there should be enough basis for public interest litigation to press claims against the CBN and/or its management; and this article presents the opportunity to delve into or analyse, the related pro and con arguments in detail.

In doing so, there will be a prefatory treatment of the legal issues, with factual background of the currency exchange exercise.

A. Factual Context: The CBN's 2023 Currency Exchange Exercise

For convenience, the author principally adopts Premium Times' timeline:2

"26 October 2022: The CBN announced the introduction of the redesign of N200, N500 and N1,000 banknotes. The CBN Governor, Godwin Emefiele, had said the banknotes were redesigned due to a request from the Federal Government. He disclosed that the new notes would begin circulation from 15 December 2022, while the old banknotes would remain legal tender and circulate together until 31 January 2023. The old notes were to cease to be legal tender on 31 January. ...

27 October 2022: The [CBN] gave reasons for the Naira redesign policy. According to Mr Emefiele, the policy would enable the CBN to take control of the Naira in circulation, manage inflation, combat counterfeiting, and ransom payment.

28 October 2022: Barely 48 hours after the currency redesign policy was announced, Nigeria's Finance Minister, Zainab Ahmed, kicked against it. Ms. Ahmed said the Finance Ministry was not consulted over the monetary policy.She expressed some reservations about the consequences of the policy on Nigeria's economy.

21 January 2023: Following the outcry that trailed the non-availability of the new banknotes and lack of public awareness, especially in rural communities across Nigeria, the CBN launched a cash swap programme in all [LGAs] of the country. The programme which took effect from 23 January, allowed the old notes to be exchanged for the newly redesigned notes.

24 January 2023: The National Assembly asked the CBN to extend the deadline for acceptance of the old Naira notes. The upper and lower chambers of the National Assembly urged the CBN to extend the deadline on the validity of the old Naira notes by six months.

25 January 2023: APC presidential candidate, Mr. Tinubu, said during a campaign stop in Abeokuta Ogun State, that the Naira design policy was orchestrated to ensure his defeat in the election.

28 January 2023: Two days to the expiration of the old banknotes, the Nigerian Bar Association (NBA), urged the CBN to review the policy. Referencing the CBN Act, the NBA's President, Yakubu Maikyau, said Nigerians were at liberty to approach the [CBN] to 'redeem' their old banknotes after the initial 31 January deadline.

29 January 2023: The CBN Governor announced a 10-day extension of the deadline for the deposit of old banknotes and the validity of the old notes. Mr. Emefiele spoke in Daura, Katsina State, after a meeting with Mr. Buhari. The apex bank had urged Nigerians to utilise the opportunity because the deadline was not going to be extended.

31 January 2023: The CBN Governor, while appearing before an Ad Hoc Committee of the House of Representatives, said banks must accept the old Naira notes even after the expiration of the 10 February deadline.

1 February 2023: The presidential candidate of the Peoples' Democratic Party (PDP), Atiku Abubakar, asked the Federal Government not to extend the 10 February deadline for ending the old Naira notes.

3 February 2023: Three Northern States – Kaduna, Kogi and Zamfara - sued the Federal Government, seeking the Supreme Court's order halting the implementation of the Naira redesign policy.

6 February 2023: A Federal Capital Territory High Court, Abuja, ordered the CBN to ensure the enforcement of the 10 February deadline for the old currency notes. The four parties in their ex parte request alleged that the CBN's new monetary policy was being sabotaged by Nigerian banks.

8 February 2023: Nigeria's Supreme Court ordered the CBN not to end the use of old Naira notes on 10 February. The court made the order temporarily, cancelling the CBN's 10 February deadline to end the validity of the old versions of the banknotes based on an ex parte application filed by three northern states – Kaduna, Kogi and Zamfara – being controlled by the All Progressives Congress (APC).

8 February 2023: Nigeria's 36 State Governors under the platform of the Nigeria Governors' Forum, appealed to President Muhammadu Buhari to extend the timeframe for the implementation of the currency policy. The Governors made their stance known in a statement signed by Sokoto State Governor and chairperson of the NGF, Aminu Tambuwal.

12 February 2023: The NGF accused the apex bank of conducting a 'currency confiscation' programme that has brought immeasurable suffering to Nigerians. In a communique issued at the end of their meeting in Abuja, the Governors called "for the halting of CBN's plan to end the use of the old currency notes."

16 February 2023: In flagrant disobedience of the Supreme Court's interim order, President Buhari insisted that the old notes ceased to be a legal tender. But Mr. Buhari acknowledged the pendency of the apex court's ruling, and the hardship being faced by Nigerians as a result of the cash crunch.

16 February 2023: Hours later, the Kaduna State Governor, Nasir El-Rufai, 'confronted' the President over the Naira redesign policy. Countermanding Mr. Buhari, Mr. El-Rufai, in a broadcast, ordered residents of Kaduna State to continue accepting the old Naira notes as legal tender.

19 February 2023: Atiku Abubakar made a U-turn admitting that the Naira redesign policy was hurting Nigerians. He called on the CBN to allow commercial banks to collect deposits of the old N200, N500, and N1,000 notes.

22 February 2023: A seven-member panel of the Supreme Court led by John Okoro slated 3 March for judgment on the Naira redesign policy suit."

3rd March 2023: the SC held that the old Naira notes will remain as legal tender until 31st December 2023, alongside the new notes.

13th March 2023: the CBN (which had previously disobeyed Court orders concerning the currency swap), issued a statement to the effect that the old notes will remain legal tender till 31st December 2023, in line with the SC ruling. 3

The timing of the currency swap policy left no one in doubt that it was meant to curb the monetisation or 'cash-jack' of the 2023 general elections, particularly the presidential election slated for 25th February 2023.4

B. Analysis - The Regulatory Overview and Context

The primary statutes that comprise the CBN's regulatory context are: (1) the Constitution of the Federal Republic of Nigeria 1999 as amended (1999 Constitution); the Central Bank of Nigeria Act5(CBN Act) and the Banks and Other financial Institutions Act 20206 (BOFIA). With Items 6 and 15, Part I, 2nd Schedule 1999 Constitution (the Exclusive Legislative List) being "Banks, banking, bills of exchange and promissory notes" and "Currency, coinage and legal tender" respectively; it follows that pursuant to section 4(1) - (4) 1999 Constitution, the National Assembly (NA) enacted the CBN Act and BOFIA, and that the CBN itself, is a federal institution, being part of the executive arm at the Federal level.7

The full article is available at:


1 'Posers and Answers: The Petroleum Industry Act 2021, Production Sharing Contracts and Stabilisation Issues', LeLaw Tax Monograph Series No.4, April 2023, p.5): (accessed 14.12.2023).

2 Ameh Ejekwonyilo, 'Timeline: Naira Redesign Policy from Inception to Supreme Court Judgement', Premium Times, 02.03.2023: For another overview, see 'Nigeria's New Banknote Crisis – A Case Study in Self-Harm or a Shrewd Step towards Modernising the Economy', Arete, 21.02.2023: (both accessed 25.11.2023).

3 See Ayodele Awi, 'Cash Politics: the Impact of the Currency Redesign Policy on Nigeria's 2023 General Election', Voices, BSG/UO, 23.02.2023: (accessed 23.11.2023). "On 26 October 2022, the Governor of the Central Bank of Nigeria (CBN) Mr. Godwin Emefiele announced that the highest denominations of the Naira, the Nigerian currency, (N200, N500 and N1000 notes) would be redesigned, giving a deadline of 31 January 2023 for all old notes to be deposited in banks in exchange for new ones. According to the CBN, the new notes would help curb corruption and currency fraud, tackle the growing menace of kidnapping for ransom, lower inflation and address the problem of having too much money in circulation. There was an immediate backlash to this, with strong opposition from the Minister for Finance, Zainab Shamsuna Ahmed, who claimed that the Ministry had not been consulted. But the CBN Governor remained undeterred and the new notes were launched by President Muhammadu Buhari on 23 November 2022.Many Nigerians felt the CBN was too quick to implement the policy and criticised the design of the new notes as unappealing. In response, the CBN rolled out campaigns to educate Nigerians on the benefits of the policy, and the Governor defied warnings from the legislative and judicial arms who continued to mount pressure that the policy, even if for good, was coming at the wrong time and questioned the haste in its implementation. By the deadline of 31 January when the old notes would cease to be legal tender, Nigeria would be less than four weeks away from a general election. The toughest resistance to the policy was soon to come, but this time it wouldn't be coming from the financial and economic experts but from the politicians."

4 According to a firm: "Many commentators have, in recent weeks, suggested that the timing of the strategic move is very revealing. It has been suggested that the withdrawal of the old bank notes from legal tender was timed to forestall the payment of huge amounts of cash to influence the outcome of the imminent elections. Some have been more outspoken and claimed it is a direct attack on the APC nominee for the Presidency, Mr Bola Ahmed Tinubu."See 'Nigeria's New Banknote Crisis – A Case Study in Self-Harm or a Shrewd Step towards Modernising the Economy', Arete, (supra). Cf. India's objective for their currency change in 2016: "The decision was taken to crack down on corruption and illegal cash holdings known as 'black money'. In an attempt to curb tax evasion, the government expects to bring billions of dollars of unaccounted cash into the economy because the banned bills make up more than 80% of the currency in circulation. Some 90% of transactions in India are in cash." Emphasis supplied. See 'India's Cash Crisis Explained', BBC, 17.11.2016: (accessed 12.11.2023).

5 Cap. C4, Laws of the Federation of Nigeria (LFN) 2004 originally enacted as CBN Act No. 7 of 2007.

6 Act No. 5 of 2020.

7 Note also that by section 251(d) 1999 Constitution, the Federal High Court (FHC) has exclusive jurisdiction "connected with or pertaining to banking, banks, other financial institutions, including any action between one bank and another, any action by or against the [CBN] arising from banking, foreign exchange, coinage, legal tender, bills of exchange, letters of credit, promissory notes and other fiscal measures: Provided that this paragraph shall not apply to any dispute between an individual customer and his bank in respect of transactions between the individual customer and the bank". Emphases supplied.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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