The other side of the coin
By Frederick Mordi
A certain banker strongly felt shortchanged by his greedy Lagos landlord, who announced an increment in his house rent without prior notice. He decided to pay the elderly man back in his own coin. He went to the landlord’s house with a bag full of coins. But the grumpy landlord did not find this funny.
He promptly rejected the bag of coins even before the banker started counting them. He demanded full payment in the more conventional nation’s currency—naira notes. The banker stuck to his coins—or to be more precise, his guns. When he completed his assignment, which took quite some time, he left the bag of coins on the irate landlord’s table and walked away. He ignored the landlord’s voluble threats to have him evicted from his house, within 24 hours, should he fail to replace the mountain of coins with paper money. The banker was certainly having his pound of flesh.
His next target was the landlord’s corpulent wife, who sells foodstuffs in one of the shops in front of the house. He made quite a large purchase that left the woman beaming with smiles. But her countenance changed when he proceeded to make payment in coins. He felt she and her husband are two sides of the same coin. She made a scene.
This humorous story is a reflection of the peculiar pecuniary situation in Nigeria today, where coins appear to have lost their appeal to the ordinary Nigerian, and even more disturbing, their status as legal tender. Coins are virtually extinct in the country. It is doubtful if any Nigerian born in the last five years or so, had used or even seen a coin. Apart from the vaults of the central bank and the 23 commercial banks in the country, perhaps the only other place you could find coins, is Shoprite. Who accepts them? Certainly not the market woman or the bus conductor! Would you blame the landlord and his wife?
But it appears Nigeria is not the only country in the world where coins are no longer in vogue. There are reportedly 10 other nations that do not use coins or if they do, on rare occasions. They all use paper money for financial transactions. In alphabetical order, these countries are: Belarus, Cambodia, Democratic Republic of Congo (DRC), Guinea, Iraq, Laos, (Nigeria?) Somalia, Vietnam, Zambia and Zimbabwe.
While inflation has been the chief reason why these countries no longer use coins, in Nigeria’s case, there seems to be an added cultural dimension. For instance, it is common knowledge that Nigerians like to ‘spray’ crisp naira notes on celebrants at weddings and other social functions. Coins would hardly serve this purpose. A government’s policy that attempted to discourage this practice had failed in the past.
Again, the cheapest commodity you could buy these days in Nigeria is probably a candy that costs N5. Even a sachet of pure water now sells for N10! The low purchasing power of the existing N2, N1 and 50k coins in circulation, renders them largely useless, even though they are still officially recognised as legal tender in the country.
Prof. Chukwuma Soludo, a former governor of the Central Bank of Nigeria (CBN), drew the ire of many Nigerians a few years back, when he mooted the idea of converting the existing N5, N10, N20 and N50 notes into coins. All these have contributed to the paucity of coins in circulation.
The introduction of cashless economy in Nigeria, which discourages the use of excess cash in the system means that the use of coins will be further relegated to the background. The CBN’s plans to introduce a coin-based vending machine for some transactions, will only succeed if Nigerians accept N5, N10, N20 and N50 notes, as coins.
But until then, the next time the banker wants to pay his rent, he may have to use card instead of coins.