A new economic report by Quartus Economics has urged the Central Bank of Nigeria (CBN) to introduce higher-value currency denominations—such as ₦10,000 and ₦20,000 notes—to address the naira’s declining purchasing power and the increasing cost of cash-based transactions.
The report, titled “Is Africa’s Eagle Stuck or Soaring Back to Life?”, argued that the naira’s steep depreciation has rendered the ₦1,000 note—Nigeria’s highest denomination—“practically obsolete” in terms of real value and convenience.
“To make the naira portable again, Nigeria can introduce higher-value bills, e.g., ₦10,000 or ₦20,000 notes, or redenominate the currency entirely,” the report stated.
Quartus Economics noted that a ₦5,000 note proposed by the CBN in 2012 would today be equivalent to a ₦50,000 note in real terms, given the 94 per cent decline in the naira’s value over the past two decades.
The analysts dismissed claims that issuing higher-value notes would worsen inflation, describing such fears as “a myth unsupported by evidence.” They explained that inflation is driven by cost-push and demand-pull factors—not by the face value of a currency.
“Countries introduce higher-value notes to maintain portability after significant currency depreciation, not to trigger inflation,” the review added.
When the ₦1,000 note debuted in 2005, it was worth about $7 at the official rate. Today, it is worth less than 60 US cents, underscoring how deeply the naira’s value has eroded.
Quartus Economics warned that the continued use of low-value notes has made everyday transactions cumbersome, especially in the informal sector where cash remains dominant. Traders, artisans, and rural dwellers now move around with bulky cash for transactions that could be simplified with higher-value denominations.
The report also observed that the cost of printing, transporting, and securing the current low-value notes has become unsustainable for the CBN.
“Outside the formal sector and the urban elite, the naira’s heavy weight is a drag on the economy and slows down growth,” it stated.
It argued that introducing ₦10,000 and ₦20,000 notes—or undertaking a currency redenomination—would improve transaction efficiency, lower printing costs, and align Nigeria’s monetary structure with other emerging economies.
The review recalled that the CBN, under former Governor Sanusi Lamido Sanusi, had proposed a ₦5,000 note in 2012, but the idea was abandoned after widespread public opposition. Quartus Economics maintained that the same rationale behind that proposal is now even stronger, given the naira’s continued slide.
“The proposal is not about printing more money but modernising the naira’s denominations to reflect current economic realities and make transactions more practical,” the report clarified.
The firm calculated the 94 per cent value loss using key consumer indicators—such as the rise in the price of imported rice (from ₦150 to ₦2,500 per kilogram) and local airfare (from ₦12,000 to over ₦150,000 between 2005 and 2025).
“These indicators show how much the naira has lost its purchasing power, and a higher-value note is needed to make the naira portable,” the report concluded.
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