The Supreme Court’s decision comes after a legal challenge initiated by the northern states of Kaduna, Kogi and Zamfara earlier this month. Many banks have not had enough of the new naira notes, leading to desperate and chaotic scenes as people tried to get their hands on them.
There were fights at ATMs, protests and mob attacks on commercial banks, local media have been reporting for days now. The chaos led to concern that it could affect this month’s elections, as many Nigerians do not have bank accounts. The head of the election commission said some election service providers will need to be paid in cash, and that could prove to be difficult.
The Central Bank said the currency redesign would help it tackle inflation, which is currently running at about 21%, curb counterfeiting and promote a cashless society. It added that 80% of the notes currently in circulation were being held outside financial institutions.
It hoped the redesign would bring some of that money being hoarded by individuals and companies back into the financial system, and so stop prices from rising so quickly. Their lawyers argued that the government’s policy had led to an “excruciating situation that is almost leading to anarchy in the land”.
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After careful consideration of the motion exparte in the application, Justice Okoro granted the prayer. Ruling on the motion, Justice Okoro held that “An order of Interim Injunction restraining the federal government through the Central Bank of Nigeria (CBN) or the commercial banks from suspending or determining or ending on February 10, 2023, the time frame with which the now older version of the 200, 500 and 1,000 denomination of the naira may no longer be legal tender pending the hearing and determination of their motion on notice for an interlocutory injunction”.
The case has been adjourned to 15 February for a hearing of the main suit.