Yesterday being 26th October, Central Bank of Nigeria(CBN) announced redesigns of the #200, #500, and of course the highest denomination #1000.

Now, the media is filled with all sort of opinions, few good opinions while major lacks in insight as concerning the real implications of this monetary redirection.

Redesigning the naira will curb:
1.Terrorism :Proceeds of terror, particularly kidnapping proceeds will be rendered useless.
2. Illegal Activities: Proceeds denominated in naira derived from hard drugs[cocaine, tramadol, weed etc] will be rendered redundant.
3. Stolen funds/assets not declared in asset declaration form: This particularly addresses stolen funds. Of course, they will be rendered useless.
4. Vote buying : With the election approaching, vote buying will be reduced.
5. Money Laundering: With this, it is difficult to launder money.

Of course it will also lead to

6. Income Redistribution: It will redistribute income from illegal activities to productive sector.
7. Reduce inflationary pressure: Since illegal monies are now eliminated, inflationary pressure will reduce.
8. Improve the naira value: Naira will improve asa result of reduced volume of naira versus the volume of dollar availability. This is projected to be small.

Note: It is expected that within few days/months between now and December, there may be proliferations of mobile banks and agency banking, driven by the illegal parties to PLACE the naira in the financial system before the deadline.

There is a CBN limit on amount of deposits by individuals/corporate bodies. If deposits exceed these limits, it will be reported to CBN.

Modified:
Exchanging the Naira for dollar may not present an escape route. How many nairas will be exchanged for dollar in the midst of FOREX scarcity. It is stressful and almost impossible to exchange the trillion of naira outside, let's assume proceeds of illegality are within the 'billion range".

Again, there are cost concerns. Cost of printing new notes versus cost of insecurity, cost of crimes. I think the benefit far outweighs the cost. We are Nigerians, we are not Americans. Certain things are peculiar to us, and one of them is boundless illegalities. They must be curb.

Looking at all the reasons above, i still dont see how the new design will do much .

People can buy dollars and after the new design, they change it back to new naira.

People can buy goods and resell after the new naira is out.

I just hope government does not want to start taxing people directly from their account, based on inflow.

The only thing i can think of is tax.