• Amid new naira shortages, Nigerians in some border communities have turned to trading in CFA francs
  • Merchants in Sokoto, Cross River and Taraba states temporarily adopted the measure against the shortage of naira banknotes in the areas.
  • The traders say that most of their assets are held in CFA and that they would convert them back to naira when it becomes available.

Nigerians in border communities are now conducting cash transactions in CFA francs, a currency popular and used by Francophone countries in West Africa and Central Africa, as the naira shortage hits hard.

Farmers and traders in the border areas of Mfum, Gurin and Illella in Cross River, Taraba and Sokoto states have reportedly resorted to temporary adoption of the currency to assuage difficulties caused by a shortage of new naira notes.

Images of traders exchanging and trading in both naira and CFA Credit: Sani Ahmad Kaitafi
Source: Twitter

CFA more accessible than naira

They say that the CFA is more accessible than the naira.

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Traders said CFA trading is not new, but the shortage of Nigerian legal tender has increased the volume of CFA trading in communities.

Currently, merchants and farmers in the communities hold their assets in CFA and would convert them back to naira when available, they said.

Traders say many of them are locked out of Nigeria’s financial system.

A resident of one of the border communities said that exchanging old naira notes for new ones is tedious due to the location of banks in the areas.

This is despite claims by the Central Bank of Nigeria that it has deployed and activated 300,000 super agents across the country to attract financially excluded Nigerians through the Naira Exchange Program.

World Bank reports on financially excluded Nigerians

A 2021 World Bank report says Nigeria’s banking population increased by 15.6 percentage points to 45.5 percent.

The report indicates that almost 56 percent of Nigerians are unbanked and the majority are in rural areas and are engaged in agriculture.

Other traders at Gurin in Adamawa said the trade will go ahead regardless of whether there is an improvement in the availability of new naira notes or not.

Traders stated that they have witnessed a boom in trading as the CFA is easily accessible in contrast to the naira.

He noted that traders have increased transactions in the CFA franc as it is readily available, noting that the naira is still accepted, but it has to be the new note.

“If the new bills are scarce in the cities, then you can imagine what the situation will be in the border communities,” said one resident.

A tweet by one Sani Ahmad Kaitafi showed images of merchants exchanging old naira notes for CFA, stating that both the Illella border town of Sokoto and the Niger Republic city of Konni have always transacted in both naira and CFA. .

He added that the shortage of the Nigerian currency has increased the volume of trade in the CFA franc and reduced trade in the naira.

CBN Assures Nigerians About Old Notes

The newly redesigned N200, N500 and N1,000 notes became legal tender on December 15, 2022, with the Central Bank of Nigeria setting January 31, 2023 for the cessation of the old notes.

The main bank has since extended the deadline to February 10, 2023.

Many Nigerians keep an eye on ATMs as shortages of the newly redesigned banknotes grow stronger, sending the price of commodities soaring.

CBN Governor Godwin Emefiele told lawmakers that banks will accept the old notes beyond the deadline, saying no Nigerian will be left behind.

ISWAP, Terrorists Ban Naira Transaction in Lake Chad, Sets New Rule

legit.ng reported that the Shura Council of the Islamic State of West Africa Province (ISWAP) has banned naira transactions for farmers and fishermen following the recent move by the Federal Government of Nigeria to redesign the nation’s currencies.

PM News reports that the Nigerian government’s move has thrown the terrorist organization into a state of confusion over the FG’s plan.

The Nigerian government earlier announced its plan to redesign the N200, N500 and N1,000 banknotes and the new designs will hit banks on December 15.

Source: Legit.ng