₦airaland Forum

Zoo nation

Christians are the biggest cowards in this zoo corntree called Nigeria. Every christain festive period, they intentionally make this difficult through cash scarcity. No daddy GO has the balls to speak against this delibrate conspiracy that has existed for years.

You have Deepsight as a moniker but you haven't demonstrated that.

His assertion is sound.

N1000 our highest currency is less than the cost of a haircut.

So that places huge demand on our notes

When there is N5000 and N10,000 notes this crunch will ease off naturally.

DeepSight:
Top notch economists ko, top notch economists ni. Go and sit down with this satanic recommendation.

VULCAN:
You have Deepsight as a moniker but you haven't demonstrated that.

His assertion is sound.

N1000 our highest currency is less than the cost of a haircut.

So that places huge demand on our notes

When there is N5000 and N10,000 notes this crunch will ease off naturally.

My brother, "top notch economists" and what they propound have been repeatedly shown not to understand developing countries, especially Nigeria.

The first thing that will happen here is that prices will start coalescing around those denominations - in the informal / cash markets.

iamtoofan:
We should introduce 5k nd 10k because of elon musks like you, imagine cost of living when 500, 1k goes extinct like #50

Today #100 cant buy you common garlic where in america lowest $1 is as useful as mosque kettle.

Sometimes i wonder where guys like you school higher notes means higher amount in circulation inside inflation na wa oo

You're again repeating the economic illiterate belief that higher denomination notes cause inflation.

No economics textbook will teach you that.

When the N100 note was introduced in 2001, it caused no inflation, neither did the introduction of the 1,000 note in 2007. Stop spreading myths.

Babatindan:
Everything is now business. Once there's no more POS operators, cash would be available. POS operators are the ones raking in cash from retailers for sale

So, where will those withdrawing cash from pos operators get cash? From banks?

AirBere:


That's the common misconception and I'll say you are absolutely spot on with this analysis.

Higher denomination banknotes do not directly cause inflation. Although not limited to but inflation is caused by the following.

1. Excess money supply
2. Demand and supply imbalance
3. Economic growth
4. Monetary policy....and others

It's a complex topic to a layman and there's no positive linear correlation between higher denomination and inflation even though it could be a factor but it's a low bar.

With all that said, the biggest problem in Nigeria right now isn't higher denomination.

It may not be the biggest problem, but the country still needs.

grandstar:
It may not be the biggest problem, but the country still needs.

How will higher denomination improve insecurity, economic growth,human development index etc?

Take this as a question not a challenge. I believe you're knowledgeable in this topic. My knowledge in economics is vast and I believe you're vast as well which was demonstrated in your first write up I quoted.

All those people shouting POS is the cause of lack of money in the bank are ignorant.

Cash crunch we are currently witnessing now is a deliberate FG policy.
They don't want too much physical cash in circulation.
They want people to go cashless and use more of electronic transactions since they can easily taxed such transactions than physical ones.
Since from a certain administration in this country, every successive administration has always been trying so hard to see to the full implementation of this their useless and dubious so called cashless policy without minding the devastating consequences it poses on the poor masses.

The most painful one is this present administration that came in, vilified and demonized Buhari and Emefiele for causing great pains to Nigeria through this same policy.
Yet,they are now doing the same thing they incarcerated Emefiele till today.
One could now ask,what was the essence of arresting and prosecuting Emefiele in the first place?
You are implementing the same "Emefiele policy" of hoarding naira in the CBN thereby creating artificial money scarcity in the economy.
Who will now put Cardoso in prison for creating cash scarcity to inflict untold suffering to the poor masses?

grandstar:
You're again repeating the economic illiterate belief that higher denomination notes cause inflation.

No economics textbook will teach you that.

When the N100 note was introduced in 2001, it caused no inflation, neither did the introduction of the 1,000 note in 2007. Stop spreading myths.

Ode, simple multiplier effect, the higher the currency the more convenience to hold large cash, if i can walk around with 1million in my LV purse unnotice with ease does that not defeat cashless economic.
Mumu in america the highest currency is $100 and no bank will dispense it to you except you are making a certain withdraw limit, $1,$5-$50 is what you get

#1000 note by value is ideal, reasonably divisible and not a threat to cashless economy you cant use that to juxatapose #10k, the way some of you reason sometimes one begins to cry for the education system in Nig.

Cash became scarce in banks since the advent of POS business, look back and reflect, when there was no POS business, was cash this scarce?

BIenc:
How come the CBN threatened to sanction bank for cash shortage ?

That nonsense was just to save face.
Banks are still paying 5k, 10k max, what has CBN done about that?

BIenc:
How come the CBN threatened to sanction bank for cash shortage ?

all na wuru wuru to the answer, looking for someone to blame for their policies.

grandstar:
The issue is not a surprise. It shouldn't be.

The Naira is now a four digit currency. It is bizarre that the highest denomination is only 1,000 naira which is about 60cents. This is ridiculous.

That maximum 100k withdrawal can only purchase 10k goods of 2007. That 100k of 2014 could last you one week. Today, you could finish it in a day. So, you need to keep withdrawing 100k from the ATM each day. This massive turnover is why banks lack cash.

When the Naira became a 3 digit currency, the CBN introduced the N100, 200, 509 and finally the 1,000 note in 2007 if I'm correct. Then the 1,000 note was worth around $8.

There's an urgent need therefore for the government to introduce the 2k,5k and 10k denominations urgently.

Unfortunately, Nigerians would say higher denominations would cause inflation which no topnotch economist would support. An increase in money supply that is higher than the increase in goods and services is whats causes inflation.

The central bank should follow global best practices and introduce higher denominations asap.

you got it spot on. The CBN financial policy is to blame for all this. They created huge inflation in the system, thereby making the people need more cash for little purchase. Just last year, you needed about 10-15k to fill a car fuel tank. Today, you need about 60-80k to purchase the same commodity.

Mrhonesty:
The problem is not the CENTRAL BANK but Nigerians. They always do that every festive period and inflate prices of goods. 9ja can only change for good when the people themselves are ready.

so it's Nigerians who made the price of fuel move from 160 to 1200? Very very flawed argument

Sundaymessi:
You go to the bank you are told that there is no money but you go to the POS you can get times three of what the bank couldn't give you.
So where do the POS get their cash from?

did you read the post at all?

Banks source their money from two channels, CBN and retailers.

CBN is going cashless, hence reducing the money they supply to banks. On the other hand, the retailers now prefer to sell cash to POS, who in turn sell to customers, rather than take them to banks. Almost every filling station has a POS they operate or possible sell to POS operator.

AirBere:


That's the common misconception and I'll say you are absolutely spot on with this analysis.

Higher denomination banknotes do not directly cause inflation. Although not limited to but inflation is caused by the following.

1. Excess money supply
2. Demand and supply imbalance
3. Economic growth
4. Monetary policy....and others

It's a complex topic to a layman and there's no positive linear correlation between higher denomination and inflation even though it could be a factor but it's a low bar.

With all that said, the biggest problem in Nigeria right now isn't higher denomination.

I think the inflation is the major problem. You need more currency note to buy fewer goods. What 2m can buy just January last Yr, you need about 10m to buy same. This applies to cash required purchases. So why won't there be scarcity of cash?

Tallesty1:
Once a Nigerian believes something, it’s almost impossible to convince them otherwise.

I’ve been explaining to people here that POS operators get their cash directly from business owners. This is why banks are complaining about not receiving enough deposits from retailers. But no, Nigerians are convinced that every POS operator is buying funds from the bank.

it's outright ignorance for anyone to think banks sell cash to POS. Banks that are in the same competition as POS. Banks require same cash to keep their atm functional and make profit.

The common solution to this is to restrict POS operators from receiving more than 20k single transfers into a POS account, and giving out cash of same.

If this is not contained, the govt might have suspend POS for a while.

1gbdata:
The banking system is the root of the problem. If customers could easily access their money through ATMs, POS operators would have fewer customers and would be forced to reduce their charges.
However, banks are reluctant to collect cash from the Central Bank of Nigeria (CBN) due to the associated costs, such as transportation, insurance, and security fees. As a result, banks are only using the cash deposited by their customers.
Ironically, by creating artificial scarcity, banks are discouraging customers from depositing their money.
Furthermore, banks are also giving large sums of money to politicians, who hoard it in private vaults.
Lastly, the introduction of transfer charges is not encouraging cashless transactions, exacerbating the problem.

u just dey mention banks, banks, banks.

VULCAN:
You have Deepsight as a moniker but you haven't demonstrated that.

His assertion is sound.

N1000 our highest currency is less than the cost of a haircut.

So that places huge demand on our notes

When there is N5000 and N10,000 notes this crunch will ease off naturally.

but in the long run, the problem will resurface. That's a short term solution to a long term problem.

The problem is inflation caused by the govt. We need more money to buy fewer goods, unlike before.

grandstar:
You're again repeating the economic illiterate belief that higher denomination notes cause inflation.

No economics textbook will teach you that.

When the N100 note was introduced in 2001, it caused no inflation, neither did the introduction of the 1,000 note in 2007. Stop spreading myths.

it sure causes inflation, especially in a cash based economy like ours.

Take doe instance a commodity sold for #995, where will the seller get the scarce #5 to remit as change? The price will automatically go up to match the single denomination.

Emeskhalifa:
That nonsense was just to save face.
Banks are still paying 5k, 10k max, what has CBN done about that?

do banks even have the cash to pay? This is the issue.

Thank God i left ..

Liars .. why are POS operators custodian of new naira notes these days ?

Bank does not give Pos money as well, most pos are getting there cash from fuel station , gas station , people selling goods in cartoons all igbos that use to sale rice and garri ..and most of this people sold it to pos people most are not free....quote author=Sundaymessi post=133268435] You go to the bank you are told that there is no money but you go to the POS you can get times three of what the bank couldn't give you.
So where do the POS get their cash from?[/quote]

trytillmake:
Dem don start, who should be responsible before, now 2h for 5k from pos, which kind
nonsense be dat

Imagine I withdraw 30k and POS charge me 600Naira, something that should be 300Naira, they charge me double