Last year, the Central Bank of Nigeria (CBN), the country's biggest financial regulator, announced the federal government's decision to redesign some currency notes and replace the old ones in circulation by 10 February 2023.
As part of the process, the old notes have to be swapped with new notes at commercial banks. The CBN mandated that the swapping had to be done before the deadline, noting that the old notes would no longer be legal tender after the set date.
However, commercial banks only have limited cash for their customers, and the scarcity of the new notes became an impediment to the swapping process.
The prevailing cash crunch birthed by the scarcity of new notes led 16 state governments to seek redress at the Supreme Court. They asked the court to void and set aside the policy because of the hardship it has caused citizens.
The court issued an interim order directing the Federal Government, the CBN, and all the commercial banks to halt the 10 February deadline.
Rather than comply with the interim order, President Muhammadu Buhari, in a nationwide address, maintained that the policy stands.
However, in a unanimous ruling delivered on 3 March, the Supreme Court has invalidated the currency redesign process, stating that it is not in line with constitutional provisions.
The presiding judge, Justice Emmanuel Agim, stated that "no reasonable notice was given as required by Section 20(3) of the CBN Act. The directive and implementation of the policy, is therefore invalid”.
In addition, the apex court argued that the president usurped the powers of the CBN when he issued the directive and that it was done without due consultation with the Council of State. The court ordered that the affected old notes continue to be used side by side with the new naira notes till 31 December 2023.
Meanwhile, the non-execution of the Supreme Court ruling has left Nigerian commercial banks in confusion, as neither the CBN nor the federal government has come out to reverse the policy or address the issues raised by the apex court.
Junaidu Aminu, the Attorney General of Zamfara state, one of the states that sued the federal government, has urged the president to do what’s required according to the Supreme Court ruling.
"What we are waiting for now is to see the old currency in circulation, and anything short of that can be termed as contempt of court. I expect President Muhammadu Buhari to also instruct the CBN Governor (Godwin Emefiele) to immediately release the old naira notes, because he promised that he would never interfere in judicial matters, " Aminu said in an interview with Punch.
Meanwhile the country's Attorney General of Federation and Minister of Justice, Abubakar Malami, has said his office cannot intervene. "Let us use the media to inform the general public that the functions of the office of Attorney General do not include monetary policy regulation.” read a statement from his office.
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