Economic analysts at Quartus Economics have advised the Central Bank of Nigeria to introduce higher-value currency notes—specifically ₦10,000 and ₦20,000 denominations—to help restore the naira’s usability and reduce the rising cost of handling cash.
The recommendation was contained in a new report titled “Is Africa’s Eagle Stuck or Soaring Back to Life?”, which argues that the continuous weakening of the naira has made the current highest denomination, the ₦1,000 note, significantly inadequate in purchasing power.
According to the report, the naira has lost about 94% of its real value in the last 20 years. Analysts noted that a ₦5,000 note proposed by the CBN in 2012 would equate to roughly ₦50,000 today, based on inflationary changes.
“Nigeria needs higher-value notes or a full redenomination of the currency to restore portability,” the report stated.
The economists dismissed concerns that higher denominations could fuel inflation, explaining that inflation is driven mainly by production costs and demand pressures—not by the value of banknotes.
When the ₦1,000 note was introduced in 2005, it was worth almost $7 at the official exchange rate. Today, it is valued at less than $0.60. This steep decline, the report says, has made basic transactions cumbersome, especially in the informal sector where cash is still widely used. Many Nigerians, particularly traders and rural residents, now have to carry large bundles of cash for everyday purchases.
The report also stressed that printing and transporting large volumes of smaller-value notes is becoming increasingly expensive for the CBN, placing a strain on operations and the broader economy.
Quartus Economics suggested that introducing ₦10,000 and ₦20,000 notes—or undertaking a currency redenomination exercise—would:
- Improve transaction efficiency
- Reduce currency printing and logistics costs
- Bring Nigeria in line with other emerging economies that adjust currency structures after significant depreciation
This is not the first time such a proposal has emerged. In 2012, the CBN under then-Governor Sanusi Lamido Sanusi planned to introduce a ₦5,000 note, but the policy was shelved following strong public resistance.
With the naira’s purchasing power continuing to fall—evident in the jump in rice prices from ₦150 per kilogram in 2005 to about ₦2,500 today, and domestic flight fares rising from ₦12,000 to over ₦150,000—the analysts argue that introducing higher denominations is now more necessary than ever.
They emphasized that the recommendation is not about increasing money supply, but aligning Nigeria’s currency with current economic realities and making daily cash transactions more practical.
