Rejection of Dollars as “Mutilated” In Nigeria Advocating In Favour of Crypto Usage
A practice of rejecting defaced and old US Dollar notes was taking place on a great scale in Nigeria. However, when the issue came to the attention of the Nigerian Authorities, a circular was issued immediately by the Central Bank of Nigeria (CBN).
The notification from CBN was issued on the directions of one of the directors of CBN namely Ahmed Umar. In the notification, the nationwide warning has been issued to institutions to stop rejecting defaced or old currency notes of US Dollars. In case of non-compliance, strict actions have been warned against non-compliant institutions as well. Furthermore, all the institutions have been warned to immediately drop the practice of rejecting the notes.
The old and defaced currency notes were rejected by the institutions on the pretext that while processing there is difficulty in authentication tests. The country is facing a high rate of inflation like many other countries. A similar, situation was also reported in other under-developed countries such as Zimbabwe. The value of Zimbabwe’s currency has fallen to the ground amid the Covid-19 crisis. In Zimbabwe also, the country’s consumers are facing similar problems of not getting their old or defaced USD notes accepted by institutions. Thereafter the US Embassy situated in Harare issued a public statement directing institutions that whether old or defaced, the currency is not denominated.
It was duly stated that whether a USD note is disintegrated, torn, soiled, or even defaced, it could not be regarded as “mutilated”. Any US Dollar note issued by the US does not require going through a special examination or authentication test. However, even after the issuance of the statement, only for a certain time the practice was dropped in Zimbabwe. However, as of now, the same practice is greatly apparent in various parts of Zimbabwe. There are also reports, which suggested that the institutions are accepting only a half worth of USD bill value if they consider it “mutilated”.
Considering these circumstances, the end consumers in various countries in Africa, think that crypto is a better option against the circumstances. They are of the view that the problem of the lower denomination is absent in crypto and therefore crypto provides more security to consumers.
If one has to send funds abroad from Africa and takes his dollars to an exchange, then he could face difficulty. For instance, there is a possibility that because of defaced or old USD bill, his note can be rejected. In the alternative, he could be asked to accept only half the value of his dollar bill. In such a situation, digital currencies such as Bitcoin (BTC) and Bitcoin Cash (BCH) allow users to conduct cross-border transactions with ease. In addition, the money is accordingly sent to the receiver without any denomination at all.
