The Central Bank of Nigeria (CBN) recently disclosed that about 100 tonnes of mutilated naira notes were destroyed weekly through open air burning at its 12 disposal centres across the country. The apex bank also acknowledged that the disposal of the mutilated naira notes wastes via burning could impact negatively on the environment as well as cause pollution and other health hazards. Although the exercise was supervised under strict security and environmentally sustainable manner, it was against the global best practice of health safety environmental standards, which every organisation, including the banking industry, should adhere to.
Therefore, we welcome the new plan by the CBN to commence the recycling of unfit banknotes. According to Sections 18(d) and 20(3) of the CBN Act 2007, the CBN is authorised to arrange for the destruction of mutilated currency notes and coins withdrawn from circulation. A statement in the bank’s website said: “In pursuant to its sustainability initiative, it has reviewed the current method of banknotes wastes disposal through open air burning with the aim of adopting more environmentally sustainable method, thereby reducing its carbon footprint.” According to the bank, the recycling bad currency notes is the best way to go to prevent wastage of potentially useful materials, reduce the consumption of fresh raw materials, minimise energy usage and avoid possible air pollution, and convert them to products that will enhance economic activities.
It is commendable that the CBN is moving away from burning of old naira notes, which is deleterious to health, to recycling, which is environmentally sustainable and economic. It is heartwarming that the apex bank is part of the global effort to promote healthy environment. The bank is already seeking proposals from accredited recycling companies interested in utilising paper banknotes waste in its recycling process in line with health safety standards and sustainable banking principles. It is good that Nigeria is embracing the recycling of bad naira notes. Apart from saving money from burning of bank notes, the exercise will prevent its attendant health hazards.
While we commend the Central Bank for taking this bold initiative, we urge Nigerians to be decent in handling the naira notes. Last year, the CBN mopped up millions of mutilated notes in circulation across the country. It threatened to sanction banks found to have issued counterfeit banknotes through any of its payment channels. The move was in response to widespread abuse of the currency and hawking by unscrupulous elements. The Director of Currency Operations at the CBN, Mrs. Priscilla Eleje, said last year while on sensitisation programme that the mop up exercise was one of the numerous efforts to preserve the integrity of the national currency. Also in 2018, the CBN set up mobile courts to try offenders of naira abuse. This was in collaboration with the police and the Federal ministry of Justice. A watchdog, known as “mystery shopper” was put in place in each state of the federation to monitor compliance with the enforcement. The mobile court was set up to try hawkers of the naira. Under the new CBN guidelines on currency mutilation and counterfeiting, branch controllers of Deposit Money Banks are authorized to work with security agencies to ensure that cases of currency mutilation are addressed.
We urge the CBN to scrutinise all the companies that are bidding for the recycling contract and select those that are competent to handle the job. Since national currency is the identity of every nation, those in charge of printing the naira notes should enhance their quality and durability. Having high volumes of unfit banknotes in circulation is unacceptable.
Ensuring that clean banknotes are in circulation requires the collaborative effort of all stakeholders, the CBN, banknote suppliers, Deposit Money Banks, minting companies, security agents and the public. There is need to improve the security features in the currency notes so that they will be hard to fake. Nigerians are advised to handle the naira with decency and respect. The CBN should continue in its enlightenment programme on the need to ensure clean naira notes.