The Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, has assured Nigerians that the ₦100 and ₦200 banknotes remain valid legal tender, dismissing concerns that the denominations may have been withdrawn from circulation.
Speaking after the Monetary Policy Committee (MPC) meeting in Abuja on Tuesday, Cardoso attributed the apparent scarcity of the lower-denomination notes to changing demand patterns driven by increased adoption of digital payment channels and broader financial inclusion.
He stressed that the apex bank has not taken any decision to phase out any denomination of the naira and urged Nigerians to continue accepting the notes for transactions.
“Yes, they remain legal tender. Unless the central bank states otherwise, Nigerians should assume that all existing denominations remain legal tender,” Cardoso said.
Explaining the reduced circulation of the notes, the CBN governor said market demand has shifted as more Nigerians embrace cashless payment options.
“As to why there appear to be fewer of these notes in circulation, it is largely a matter of demand and supply. The financial ecosystem is evolving in the direction we want it to, with greater financial inclusion and increased digitisation.”
He added that the growing reliance on electronic payment systems has naturally reduced the need for printing and circulating smaller denominations.
“As more people adopt digital payment channels, the demand for coins and lower-denomination notes naturally declines. If there is less demand for them, there is less need to print and circulate them in large quantities,” he said.
Cardoso also acknowledged that inflation and the weakening purchasing power of the naira have affected the usefulness of lower-value notes in everyday transactions.
“Of course, we must also acknowledge that currency devaluation has affected the purchasing power of lower-value notes. That is a reality.”
He, however, maintained that the continued expansion of financial inclusion and digital banking services would further reduce dependence on physical cash, particularly lower denominations.
On the country’s inflation outlook, the CBN governor reiterated the bank’s commitment to restoring price stability and achieving single-digit inflation despite global economic headwinds.
According to him, Nigeria had been making steady progress with 11 consecutive months of disinflation before unforeseen external shocks slowed the pace of improvement.
“It is important to remember where we are coming from. We recorded 11 consecutive months of disinflation and, from every indication, we expected that by early 2027 we would be where we wanted to be in terms of inflation, with a path towards single-digit inflation.”
He noted that persistent external pressures have delayed the expected progress but insisted that the apex bank remains focused on its target.
“Unfortunately, we have experienced external shocks that were not anticipated and have lasted much longer than anyone expected. As for our single-digit inflation target, we remain committed to it,” Cardoso stated.
