The apex bank also decries the fact that Securency holds the patents and rights of some of Nigeria?s banknotes

The Central Bank of Nigeria (CBN) says it resolved to discontinue printing the naira in polymer notes so as to take away the monopoly of printing the currency from the Australian firm – Securency International Pty Limited.

Tunde Lemo, the apex bank?s Deputy Governor, Operations, said that as a result of the monopoly, regulator was always forced to pay whatever amount the firm charges; adding that there are also a lot of ?environmental issues? surrounding the polymer notes.

Under the proposed new currency structure, expected to take effect in January 2013, the existing notes of N50, N100, N200, N500 and N1, 000 are to be redesigned with added security features. The N5, N10, and N20 notes will be replaced as coins, while a N5000 note will be introduced.

?Securency is the only producer of polymer currency in the world and so the CBN has been resorting to single sorting for banknote,? said Lemo. ?This, we think, is not good for the country. Even though the plan is to coin N5, N10 and N20, the N50 note will be converted to paper currency. However, if Nigerians show preference for retaining the N5, N10 and N20 in banknotes instead of coins, it shall no longer be in polymer.

The destruction of banknotes made of polymer has proved to be a challenge in Nigeria from an environmental perspective. Briquetting (destruction of unfit banknotes) of polymer is not always easy because it is made of polythene and emits substances that are not environmentally friendly.?

Lemo also stated that another reason to do away with polymer notes was as a result of the scandal handing on Securency?s neck. This to him cast doubt on the integrity of the Australian firm.

Ugochukwu Okoroafor, bank?s spokesperson, had said last week that unlike in the past where printing firms held the patent and right to produce the naira, the currency restructuring would make the CBN hold the patent of the new set of currencies that would emerge from the process.

?We need to take back all our patents and right,? he said. ?Right now, some of the patents and rights do not belong to Nigeria or the CBN. We had a rude shock when that became an issue when we wanted to print a particular set of notes.  So we are using this exercise to take back that right. If it belongs to Nigeria, nobody will hold us to ransom.?

According to Okoroafor, the proposed introduction of a higher denomination of banknote would enable the apex bank save about N7 billion out of its annual cost of printing currency. ?Every currency gets reviewed once in a while,? he said. ?Right now, the United Kingdom is reviewing its currency. So currency review is something that we must do.  As a monetary authority, it is our responsibility enshrined in the CBN Act 2007.?

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