The Governor of the Central Bank of Nigeria (CBN), Olayemi Cardoso, has assured Nigerians that N100 N200 notes remain legal tender, explaining that their reduced circulation is driven by the rapid growth of digital payment systems and the declining purchasing power of the lower-denomination currency.
Speaking after the Monetary Policy Committee (MPC) meeting in Abuja, Cardoso dismissed speculation that the Central Bank had withdrawn the N100 and N200 notes from circulation, stressing that no such directive had been issued. He urged members of the public and businesses to continue accepting the denominations 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.
The CBN governor explained that the apparent scarcity of the notes reflects changing demand patterns within the country’s financial system rather than any policy to phase them out.
According to him, increased financial inclusion and the growing adoption of electronic payment channels have significantly reduced reliance on physical cash, especially lower-value denominations. Cardoso also pointed to the impact of naira depreciation, noting that inflation and currency devaluation have weakened the purchasing power of the N100 and N200 notes, making them less useful for everyday transactions.
“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 said.
He added that as more Nigerians embrace digital payments, dependence on lower-denomination cash is expected to continue declining.
Addressing inflation, Cardoso reaffirmed the apex bank’s commitment to restoring price stability and achieving single-digit inflation despite recent global economic disruptions. He recalled that Nigeria experienced 11 consecutive months of declining inflation before unexpected external shocks slowed the disinflation process.
“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 said.
Cardoso noted that prolonged global economic pressures altered those projections but insisted that the CBN remains committed to its long-term inflation target.
Responding to the International Monetary Fund’s assessment that the naira is undervalued at around N1,150 to one US dollar, the CBN governor maintained that exchange rates should be determined by market forces rather than administrative controls.
He said the apex bank would continue to support a transparent foreign exchange market based on a willing-buyer, willing-seller model. According to Cardoso, Nigeria’s foreign exchange market has become more transparent and liquid, with daily trading volumes exceeding $1 billion on some occasions.
He attributed the improved performance to stronger investor confidence, increased market liquidity and ongoing reforms aimed at creating a more efficient and open foreign exchange system. Cardoso reiterated that the Central Bank would continue implementing policies that strengthen financial stability while supporting sustainable economic growth through transparent monetary and exchange rate management.
