The Central Bank of Nigeria has directed old N200, N500, and N1,000 banknotes remain legal tender in line with the Supreme Court Judgement.
According to the press release by the Apex Bank on Monday 13th of March 2023 through the Ag. Director Corporate Communications, Isa Abdulmumin:
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Silicon Valley Bank (SVB) was a commercial bank with the headquarter in Santa Clara, California US.
As of June 30, 2016, SVB had a 25.9 percent market share, making it one of the biggest banks in the country and the largest bank in Silicon Valley based on local deposits.
Silicon Valley Bank provides financial assistance to startups, individuals, investors and international innovative companies to achieve their ambitious objectives. “SVB is the financial partner of the innovation economy”
The second-largest bank failure in American financial history occurred on March 10, 2023, as a result of a bank run on SVB’s deposits, and the Federal Deposit Insurance Corporation was appointed as receiver.
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The Independent National Electoral Commission (INEC) was created in year 1998 and is the electoral body which organises and cordinate elections in Nigeria.
INEC is a product of metamorphosed Electoral Commission of Nigeria (ECN) which was inaugurated in 1958 to conduct the 1959 federal elections.
General Abdulsalam Abubakar’s Administration dissolved the National Electoral Commission of Nigeria (NECON) who conducted the controversial election that General Abacha annulled and established the Independent National Electoral Commission (INEC).
INEC is therefore established to save the Democracy in Nigeria.
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In the bid to expand operation and reach more Nigerians, Servpay has added to her collection Benin Electric Distribution Company (BEDC).
Customers can now make BEDC Postpaid and Prepaid electric bill payments on servpay.ng.
BEDC is one of the largest DISCOS in Nigeria and responsible for retail distribution of electricity in Delta, Edo, Ekiti and Ondo States with geographical coverage of 55,770 square kilometers.
Utility bills mostly form a chonk of total daily or montly income of individuals. Servpay.ng is committed to affordable and seamless way of making bills payment.
Nigeria is currently undergoing a critical financial reform. The President and the Governor of Central Bank of Nigeria (CBN) had concluded plans and implemented currency change and swap programs.
The new currency change Policy had taken everyone by surprise but with much more polical implications.
The past 8 years in Nigeria, the currency in the economy had risen from N1.4 trillion to N3.23 trillion. The proportion of currency outside the banks grew from 78% in 2015 to 85% in 2022. As at October 2022, only N500 billion was within the Banking System while N2.7 trillion remained permanently outside the system; this development poses a great threat to the economic growth.
The CBN has therefore commenced the processes of absorbing the old currency notes of N200, N500 and N1000 with clear directives to concerned individuals.
The following are the required steps to deposit the old Naira Note:
Deposit above N500,000 will only be made at any of the CBN branches in the country.
While the N500 and N1000 notes have been declared a Non Legal Tender, the old N200 banknotes is expected to circulate as legal tender till April 10, 2023.
The Central Bank of Nigeria (CBN) under Sections 2(d), 33 (1) (b) and 47(2) of the CBN Act 2007 issued the regulation for Bill Payments in Nigeria, 2017 to promote sound financial system.
The guidelines are primarily to facilitate the development of an efficient and effective payments system in Nigeria.
The CBN have established and defined key players in bill payment policy to help achieve her objectives. The following are the stakeholders:
Payer – the individual or corporate entity making a bill payment.
Biller – a registered entity/merchant that receives funds from the payer as consideration for the provision of service or product.
Payer’s Bank – the bank where the payer maintains the account that is debited to make the bill payment.
Biller’s Bank – the bank where the Biller maintains the account designated to receive proceeds of payment made by the payer.
Payments Service Provider (PSP) – a person licensed by the Central Bank of Nigeria to provide services involving direct interactions with the payment, settlement and clearing systems and payment system arrangements, as the Bank may authorize from time to time and may include a bank, Mobile Money Operators or Other Financial Institution that is connected directly to a Biller without any service intermediary.
The Bill Payment regulation has opened up the digital space in Nigeria. Before now, typical payment for services like electricity, water, airtime, cable TV are often done physically. Individuals would visit physical outlets of the service providers to make payment.
The CBN regulation have opened up opportunities to all the players in the industry:
A. Network Availability. Unstable payment network poses a major concern in the industry. The service providers or the Billers must continually increase their capacities to handle high traffic as Payers engagement increases.
B. Cyber Crime Vulnerability. In Africa, the cybercrimes has recorded a massive rise in the first six months of 2022, “with phishing and scams hitting 438 per cent and 174 per cent in Kenya and Nigeria, respectively”, the Guardian Newspapers. reported on August 3, 2022.
According to the Economic and Financial Crimes Commission, ” over 2,800 persons convicted of cybercrime in 2022″
Overall, the financial sector in Nigeria is fast developing with lots of prospects for investors
Starlink is a satellite internet constellation founded by Elon Musk and operated by SpaceX.
Starlink which now covers all the seven continents in the world provides Satellite Internet access coverage to about 47 countries but still planning to expand to other countries. Starlink is also aiming for global mobile phone service after 2023.
SpaceX launched Starlink satellites in 2019 but as at December 2022, Starlink has done over 3,300 mass-produced small satellites in low Earth orbit (LEO), which communicate with designated ground transceivers.
SpaceX tweeted on the 30th of January 2023
“Starlink is now available in Nigeria- the first Africa country to receive service!“
being an official announcement of Starlink kick off in Nigeria.
To place an order for Starlink internet hardware from Nigeria, kindly visit starlink.com and select Nigeria as service address.
According to Starlink, customers in Nigeria typically see download speeds of 50-200 Mbps. No contracts, 30-day trial.
The company also stated that shipping period is estimated to be 2-4 weeks from order.
Cost to acquire a Starlink hardware in Nigeria is N268,584 with N19,260 monthly subscription. Payment can be made in Naira and National Identification Number (NIN) will be required to complete payment.
According to the reports from the Nigerian Communications Commission (NCC), there are about 154,847,901 internet subscribers in Nigeria as at December 2022. Mobile data users made up about 154,277,373 which is 99.6% of all internet users in Nigeria.
At the moment, mobile Telecommunication Operator’s in Nigeria are currently battling with high inflation rate, high cost of operation and congestion on their network hence emergence of Starlink in Nigeria would be a relief to many heavy internet users in Nigeria.
From the available statistics, the industry is still viable for satellite internet companies to explore but they must be able to compete in terms of download speeds and service pricing.
Nigerians celebrated the New Year of 2023 with the news of increment in electricity tariff. Most of the electricity distribution companies in Nigeria effected the increase starting from the MD (Maximum Demand) customers and other bands. Customers reported changes of their tariff from the rate of N61.75 to around N77.2 per kwh in the month of January.
However, the Nigerian Electricity Regulatory Commission has released a statement clarifying the circumstances and reminding the electricity consumers the agreement with DISCOs (Tariff Order of January 1, 2021) on systematic increment in tariff over a certain period to accommodate inflation and high cost of sourcing for forex in Nigeria.
“The Commission” affirms that “NO approval has been granted for a 50% tariff increase in the Tariff Order for electricity distribution companies which took effect on January 1, 2021. On the contrary, the tariff for customers on service bands D & E (customers being served less than an average of 12hrs of supply per day over a period of one month) remains frozen and subsidised in line with the policy direction of the Federal Government. In compliance with the provisions of the Electric Power Sector Reform Act (EPRSA) and the nation’s tariff methodology for biannual minor review, the rates for service bands A, B, C, D and E have been adjusted by NGN2.00 to NGN4.00 per kWhr to reflect the partial impact of inflation and movement in foreign exchange rates”.
“In the light of strong public interest on this matter, the media is hereby requested to retract their earlier publications misinforming electricity consumers nationwide about a purported 50% increase in electricity tariffs” this is according to the statement released by NERC.
In another news, NERC has approved the application from Ibom Utility company to operate an independent electricity distribution network licence which will enable the company distribute electricity in selected locations in Akwa Ibom State. At the moment, Port Harcourt Electricity Distribution Company covers the Akwa Ibom State.
The world has never been static. It evolves and revolves. Ever dynamic effect of the world has also affected all its constituents including her economy which encompasses all activities related to production, consumption and trade of goods and services. The year 2022 started on a shaky note but ended with mostly negative indices. For example, the UK ended the year 2022 with a double figure inflation as against single digit at the beginning of same year. Experts have warned the new year 2023 might just be the period where the consequences of all of these would be felt the most. The following are factors that will would affect the global economic outlook for the year 2023;
What began with mere speculation eventually turned into a real war. The kremlin invaded Ukraine on the 24th of February 2022 and since have been waging war. Since the beginning of the war, there has been Europe’s largest refugee crisis since World War II, Russia’s GDP for the year reduced to a 3–4 percent, about 8 million Ukrainians were displaced within their country by late May, and more than 7.9 million fled the country by 3 January 2023 and Ukraine’s economy contracts by average of 44% according to study.
The special military operation as claimed by the Russia Authority in Ukraine has resulted into about €93.8 billion from 40 countries in financial, humanitarian, and military aid to Ukraine, from 24th January to 3rd October of 2022 according to The Kiel Institute. These funds could have been devoted to local economies which would in turn assist the Global Economy.
Energy has been one of the driving force of the Global economy. Fossil fuel and Natural Gas are critical in manufacturing industry and household consumption. The Ukraine and Russia have has disrupted in natural Gas chain supply globally and has caused unpredicted inflation, Gas and electricity crises in Europe. The winter is here, the energy crises will forcefully cause higher spike in inflation first quarter of the year 2023.
The world is experiencing shortage and disruption in food supply. Ukraine who’s is the world’s largest supply of grains has been fighting war with serious effected on farming in the country. Shortage of grain globally has also caused almost 40% inflation in poultry and bakery products in both developed and developing counties.
According to theguardian “UK food price inflation has hit a new high of 12.4%, according to data from the British Retail Consortium, with fresh foods leading the rises.” It’s been an incredibly stressful week, says White (manager at a foodbank in UK), “with a big shift in numbers seeking their help and the urgency” We expect these crises to spill to the year 2023 effectively throughout the first quarter.
Climate change was seen as a myth especially by some policy makers but it has never been this real. The continuous change in weather condition has affected farming conditions leading to poor outputs. Energy generation from renewable energy sources are been impacted by climate change hereby leading to reduction in energy output. “One of the biggest concerns sceptics raise about renewable energy is its intermittent nature or the idea that the sun does not shine all the time, nor does the wind blow every day”.
Covid pandemic ravaged the world for almost two years. The pandemic which stated in China 2019, affected the Global economy from 2020 to 2021. By the end of 2021, countries have stated recovery process by opening up and lifting restrictions except for China who still maintains Covid restriction throughout the year 2022 till the month of December same year. However, when China opened up, we realized it was mainly due to pollical pressure and that cases of Covid effection continually increase with mortality rate peaking. As at January 2023, travel restriction out of China has been lifted and expert feared this could once again lead to a global pandemic. Few countries are recording new cases of Covid infection already. The Global economy can once again be impacted negatively due to Covid infection in the year 2023.
Nigeria has been flat footed throughout the year 2022. All indices seems to be negative and on a sliding mode. With the current population of over 219m according to worldometers, about 113m of Nigerians are living in poverty according to a report by the National Bureau of Statistics (NBS) announced November 2022.
According to the Debt Management Office, DMO in December 2022, Nigeria’s public debt reached N44.6 trillion in the third quarter of the year (Q3 in 2022) This represents a 2.9 per cent quarter-on-quarter decline when compared to N42.84 trillion recorded in Q2 in 2022.
Also, Going by the data published by the NNPC, the Federal Government spends about N40.1bn daily when subsidising every litre of petrol consumed in Nigeria by at least N600. This also means that the government is spending about N1.243tn on fuel subsidy every month. The Federal Government plans to remove fuel subsidy in the year 2023.
The annual inflation rate in Nigeria accelerated for the 10th straight month to 21.47% in November of 2022 from 21.09% in October and above market estimates of 21.15% according to Trading Economics. The Central Bank of Nigeria raised the Interest rate to 16.5% as at its November 2022 meeting. This indicates fourth straight rate increase so far in the year 2022.
The Naira continues to fall to dollar and access to forex by most Nigerians for businesses and other domestic use have been through the black market. Recently, most Nigerian banks blocked access to forex via local Master or Visa cards. Demand for forex especially prospective international students seeking greener pastures abroad is also reducing the value of Naira daily. There is also the issue of foreign reserve deficit. The reserves has declined from about $40billion dollars in January 2022 to an estimate of $37billion in December 2022.
Inflation rate in Nigeria is expected to continue rise in the first two quarters of the year 2023 due to the combination of the above-mentioned factors. Cash less policy if well implemented will stabilize the Nigeria economy by the end of the second quarter.
It is the Election Year in Nigeria, the new government will resume effectively from the month of May 2023. But till this period, we don’t expect much improvement in most ecomomic sectors for example, insecurity will continue to affect cost of agricultural products and contributes to the county inflation rate.
Nigeria will not be able to attract much more needed foreign investors for the first half of the year 2023 and rate of employment is also not going to improve anyway.
Nigeria will continue to lose her professionals in all the sectors of the economy for better opportunities in foreign countries.
Tips for Folks
1. Cut spending as much as possible and save more.
2. Stay healthy as much as possible as health is wealth.
3. The cost of food and groceries are on the increase, it will continue into the year, Nigerians must be strategic and wise.
4. There have been no significant efforts from the Government to improve employment. The rate of unemployment will be peaking to the second quarter of 2023.
5. Small scale businesses will thrive in the midst of baldly managed economy.
6. Always have a product to sell or service to render.
The National Insurance Commission (NAICOM) the insurance regulatory body in Nigeria has issued a circular on the 22nd of December 2022 for the new rates for vehicle Insurance in the country.
The motor Third Party insurance which is the basic policy every vehicle owner should have according to the NAICOM Act 1997 will no longer be N5,000 for private vehicles but N15,000 effective from 1st January 2023 according to the directive by the NAICOM. Also, the rates for all the commercial vehicle insurance policies have also increased by average of 200%. Typical commercial motors and staff buses will have to pay N20,000 for new Third Party insurance rates or premium. New premium rates for Trucks and Tricycles are N100,000 and N5,000 respectively.
Aside the new rates that have been applied to the Motor Third Party Insurance, the Third Party Property Damage Liability (TPPD) have also being increased. Due to constant increase in inflation rate and cost of living in Nigeria, its expedient to ensure TPPD indeed cover liabilities in line with the current realities. New TPPD for Private Motor Vehicle Insurance is now N3m and for commercial vehicles ranges between N3m to N5m depending on the type.
Most vehicle owners in Nigeria see motor Third Party Insurance as a ritual to evade the harassments of traffic Enforcement Agencies. However, with proper education of the populace on getting authentic Motor Insurance from good insurance companies, there will be no issues of road blockage, argument and fighting when there are collision of vehicles as 3rd party insurance polices will be able to provide enough cover for the people.
The directive from NAICOM also pegs the new rate for Comprehensive Insurance at 5% of the sum insured after all rebate and discount. Meanwhile servpay.ng offers affordable and reliable Motor Third Party Insurance for both private and commercial vehicles in 5mins from one of the flagship insurance company in Nigeria. Click here to get started.
