CBN Speaks On Validity Of ₦50, ₦100, Other Lower Naira Notes

The Central Bank of Nigeria (CBN) has reaffirmed that all lower denominations of the national currency including the ₦50 and ₦100 notes, as well as existing coins remain valid legal tender across the country. The apex bank clarified that it has not withdrawn these lower-value currencies from circulation, urging the public, commercial banks, and businesses to accept them for day-to-day transactions without hesitation. 

The clarification comes in response to growing public concern over the widespread scarcity of smaller cash denominations in markets, transit hubs, and retail outlets nationwide. The shortage has fueled rumors that the monetary authority was quietly phasing out lower-value notes. Addressing these speculations following the latest Monetary Policy Committee (MPC) meeting in Abuja, CBN Governor Olayemi Cardoso stated unequivocally that no decision had been made to demonetize lower naira denominations. 

"They are still legal tender. To the extent that the Central Bank has not said otherwise, please assume they are legal tender," Cardoso said, urging Nigerians to disregard unfounded rumors regarding their status. 

Demand, Supply, and the Shift Toward Digital Payments

Addressing the visible shortage of smaller notes in physical circulation, the CBN governor attributed the trend to evolving market dynamics and changing consumer habits rather than a policy-driven recall. According to the apex bank, the reduced volume of lower denominations in everyday trade is largely driven by a significant rise in digital payment adoption and financial inclusion across the nation. 

"The question as to why we do not have as many of them in circulation as may be perceived is a question of demand and supply, quite frankly," Cardoso explained. "The ecosystem is moving, as indeed we want it to move, to one of financial inclusion where digitization is becoming increasingly important to many. If there is no need for coins or for lesser denominations, then there is no need to have them." 

The CBN highlighted its broader strategy under the Payments System Vision (PSV 2028), which aims to accelerate cashless adoption, lower cash-handling expenses, and streamline instant retail settlement channels. As more micro-transactions shift toward mobile transfers, USSD codes, and digital wallets, the baseline demand for physical ₦50 and ₦100 notes from financial institutions has naturally adjusted. 

Furthermore, economic analysts note that inflationary pressures over recent years have altered purchasing power, making higher-denomination notes like the ₦500 and ₦1,000 more frequent in cash-based commerce. However, the apex bank reiterated that cash still plays a crucial role for millions of unbanked citizens and small-scale traders. 

Warning Against Currency Rejection

The Central Bank cautioned vendors, transport operators, and financial service providers against refusing lower denominations. Rejecting validly issued currency remains an offense under Section 20(5) of the CBN Act 2007.

The bank also reassured the public regarding both standard and commemorative versions of the ₦100 note, emphasizing that both variants carry equal legal tender status and must be accepted universally. 

The apex bank urged commercial banks to continue issuing available lower denominations to cash-requesting customers and encouraged citizens to report any instances where businesses or deposit money banks refuse to accept valid lower naira banknotes.