Vanishing legal tender: Sad fall of N5, N10, N20 notes

Once useful for buying everyday essentials, N5, N10 and N20 notes are fast losing their place in daily transactions, as rising prices steadily strip them of purchasing power. From their usefulness for transport fares and purchases in shops and markets to transactions at bank counters, the once-familiar denominations are increasingly sidelined. DANIEL AYANTOYE traces the fading relevance of the low-denomination notes, highlights what they can actually buy today and explores how inflation has eroded their value in the economy

“Please, what do you have that I can buy for N10?” At a roadside provision shop in the Ketu area of Lagos State, the question seemed almost absurd.

The woman behind the counter, identified as Iya Aliyah, stared at the reporter for a few seconds. She hissed, shook her head and replied in Yoruba: “Ilokulo le fin lo mi yen?” meaning, “It is nonsense that you are introducing to me?”

The reporter tried again.

“Even if it is the smallest item in your shop, I wouldn’t mind paying N20 for it.”

Iya Aliyah’s patience appeared to wear thin.

“Please don’t get me annoyed. Who do you see spends those money again? If you don’t have something meaningful to buy, please leave. It is too early for this rubbish,” she retorted.

This Ketu trader’s reaction was not isolated as the same response followed the reporter across markets, kiosks and motor parks.

N5, N10 and N20 may still be recognised as money, but finding something they can actually buy has become increasingly difficult.

In Lagos, where commuters pay for short journeys, workers buy breakfast from roadside sellers and traders negotiate over the smallest possible margins, the declining purchasing power of the denominations is particularly visible.

A field exercise involving the three denominations across selected locations in the metropolis offered a striking picture of how dramatically the meaning of “small money” has changed.

At Berger, Ojota, Ketu, Mile 12 and Ikorodu, Saturday PUNCH repeatedly posed a simple question to traders, transport workers, POS operators and consumers: what is the cheapest thing available for N5, N10 or N20?

When small money stopped buying

“I don’t collect it again and people have since stopped asking for N5 and N10 things. Even if I give five of this N10, which makes N50 as change, they don’t collect it from me. So, I also stopped taking it from customers. The least money I collect is N50,” a grocery trader in Ketu, Mr Emmanuel Ezeudo, said during a visit to his shop on Monday.

The least item in Ezeudo’s shop is sold for N50, including sweets and chewing gum, which are sold at three for N50.

The reporter pressed further.

“What if I buy an item and it remains N10 change, won’t I get the change from you?”

He replied, “No item is available that will remain that change. I don’t take N20, so you will not bring N60 for N50 sweet. Maggi is also sold for N150 per pack or counting, which starts from N100. So, there is nothing you can buy for that amount.”

The situation was similar at a roadside stall around Ojota.

A trader identified as Chinedu placed several small items on his counter and explained that prices had moved beyond the amounts represented by the small notes.

The reporter asked what N20 could buy.

“Nothing is available here. Even as small as sweet, you cannot get it for N20,” Chinedu replied.

At a neighbourhood shop in Ikorodu, the reporter asked what could be bought for N10.

The shopkeeper, Eunice Ajayi, gave a response that captured the changing place of the denomination in everyday transactions.

“It has been long I saw N10. Where did you see it? We no longer spend it,” she replied, looking amused.

The same was true of the N5 note.  A trader at Mile 12 market, Idowu Olaitan, simply waved away the thought of selling an item for the amount.

“What will I sell with for N5? Even if I give it to beggars, they won’t take it,” he said.

At a roadside corn stall in Berger, Veronica Innocent explained that the least corn is sold for N200.

This was even as a bitter kola seller in the area also said a single one is sold for N200.

Small notes disappear from transport

For transport, small denominations once played an important role in settling fares and providing change. But as petrol pump price kept increasing, transport fares also rose, pushing the small notes further out of everyday transactions.

At Kutu bus stop, a commercial tricyclist, Friday Onoja, told Saturday PUNCH that the least fare is now N100.

He said, “As of last year, we still collected N100, but now it is N200 for the shortest distance, and that is because of the continued increase in petrol pump price. Today, petrol is N1,400, and if it increases again, we will also increase the transport fare.”

Similarly, a commercial bus driver at Ojota, Yusuf Abiodun, explained that while transport fare to Maryland from Ojota costs N300, any drop along the route costs N200.

The supermarket contrast

While roadside kiosks, traders and transporters do not accept the small denominations, there was a contrast at the supermarket.

During a visit to Boku Supermarket at Ketu, some items were visibly displayed with their price tags, allowing customers to spend or collect change in lower denominations.

For instance, Dano Milk is sold for N130, Three Crown milk is sold for N120, and Vatali Milk is sold for N60.

A cashier, whose name was withheld, said the scarcity of the small denominations sometimes creates bottlenecks, as some customers insist on getting their change.

The cashier said, “Sometimes, some people will insist on their change. If you buy milk for N60 and bring N100, we have to give you N40, and if there is no change, some will still insist on collecting it. If the person has N10, we will collect it and give N50. So, we still use the smaller denominations. Meanwhile, where we don’t have change, we tell the customer to pick sweets or any small item within the value of the lower denomination.”

Scarce small denominations

The search for N5, N10 and N20 notes around Berger soon became a test of patience.

For almost two hours on Monday, the reporter moved around the busy area, approaching traders, passers-by and even beggars, asking if they had any of the small denominations.

But the notes were surprisingly difficult to find.

Person after person checked pockets or searched through their money, only to shake their heads.

Eventually, a 53-year-old woman identified as Mummy Shade produced N5 and N10 notes.

Another woman, who refused to disclose her name, gave N5, while a trader provided N20.

Mummy Shade’s source of the small notes was particularly revealing.

She reached into a book kept in her shop and brought out the N5 and N10 notes she had tucked away.

The woman explained that she had deliberately kept the small denominations for future reference.

Scarcity in the bank

The shortage of the lower-denomination notes was also evident during visits to some financial outlets.

When Saturday PUNCH visited Access Bank and FirstBank branches in the Ojodu Berger area of Lagos State on Thursday, customers were seen depositing and withdrawing mainly higher denominations.

At Access Bank, a cashier, upon inquiry, told this reporter that N5, N10 and N20 notes were not available.

At FirstBank, however, a cashier said the branch had only N200 worth each of N5 and N10 notes.

Stacked on a table behind the cashier’s counter was a pile of N500 notes waiting to be issued, while three cashiers attended to customers.

However, one of the cashiers offered N5, N10 and N20 notes to this reporter after he disguised as a brother to a groom who needed the denominations for a traditional marriage ceremony.

A check at the Automated Teller Machines of the banks further showed the limited availability of lower denominations.

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The ATMs checked did not dispense N5, N10, N20 or other lower-denomination notes.

A Point-of-Sale operator at Ketu, Blessing Kalu, said she had no need for small denominations as they had become “irrelevant” to transactions.

She said, “The transaction on my terminal starts from N100. If you send N50 or lower, it means you don’t have any money.”

Another POS operator at Mile 12, Islamia Abiodun, said the small notes had become impractical for transactions because of their low value.

She said, “If I do a transaction of N50 for you, how much will you pay as charges? N10? What is that?”

When N20 was Nigeria’s biggest note

When Nigeria switched from the pound, shilling and pence system on January 1, 1973, the Central Bank of Nigeria introduced the naira and kobo.

The initial banknotes were N10, N5, N1 and 50 kobo, while coins were issued in smaller denominations.

On February 11, 1977, the CBN introduced the N20 note. It was the highest denomination in circulation at the time.

According to the apex bank in a statement on its website, the introduction was driven by economic growth, increased preference for cash transactions and the need for convenience.

Historical prices from Lagos provide a glimpse into what those denominations represented in everyday spending of those days.

A table published in Industrial Relations in Africa, page 14, cited a study of selected prices in Lagos.

The document recorded the price of a 16-ounce loaf of bread at 10 kobo in 1973. Sugar was 20 kobo, Lux soap was 8 kobo and Omo detergent was 20 kobo.

Also, a tin of beans and a tin of rice each cost N5, while a pound of beef was 45 kobo.

At those recorded 1973 prices, N5 was equivalent to the price of 50 of the 10-kobo loaves of bread, while N10 was equivalent to 100 loaves.

The historical table also showed how quickly prices changed, as a 16-ounce loaf of bread rose from 10 kobo in 1973 to 15 kobo in 1974 and 20 kobo in 1975.

Sugar increased from 20 kobo to 25 kobo over the same period, while Lux soap rose from 8 kobo to 17 kobo and Omo from 20 kobo to 35 kobo.

A tin of beans rose from N5 to N6.50, while a tin of rice increased from N5 to N10 between 1973 and 1975.

Meanwhile, the broader economic environment was also changing.

CBN historical data show that Nigeria recorded inflation of 5.4 per cent in 1973, 12.67 per cent in 1974 and 33.96 per cent in 1975.

While the N20 note was regarded as the highest denomination when it was introduced in 1977, the same denomination later became part of the lower end of Nigeria’s banknote structure.

Higher denominations, N100, N200, N500 and N1,000, were later introduced between 1999 and 2005 in response to economic activities and the need to facilitate an efficient payments system, according to the CBN.

‘I built four-bedroom flat with N27,600 in 1986’

Speaking in an interview with Saturday PUNCH, 85-year-old Chief David Alawode narrated how he built a four-bedroom flat in Ibadan, the Oyo State capital, for N27,600 in 1986.

He said, “In 1974, I bought my plot of land for N275. When I wanted to build it in 1986, cement was N3 per bag. One block was 20 kobo. Bricklayers were paid 35 kobo when they worked from 8am to 4pm. A water fetcher was paid 15 kobo.

“The bundle of zinc, comprising 20 sheets, was N214. A load of gravel was N30, while sand was N25, and I bought six loads of each. I completed my four-bedroom flat in Ibadan with N27,600.”

Still legal tender, but buying less

The Central Bank of Nigeria still lists all three denominations alongside other higher denominations as legal banknote denominations.

Their nominal values, however, have remained fixed while the prices of goods and services have increased.

An N5 note is still worth N5, an N10 is still worth N10, and an N20 is still worth N20. What has changed is what those amounts can buy.

Nigeria’s headline inflation rate stood at 15.39 per cent in August 2026, according to the National Bureau of Statistics, down marginally from 15.43 per cent in July.

But the Consumer Price Index itself rose from 145.3 points in July to 146.3 points in August, indicating that prices continued to rise even as the annual rate of increase slowed.

The scale of the change becomes clearer when the cost of food is considered.

The NBS reported that the national average cost of a healthy diet rose from N786 per adult per day in December 2023 to N1,495 in December 2024, representing a 90 per cent increase in one year.

By March 2026, the average cost had risen to N1,541 per adult per day, according to the NBS data.

In an economy where a healthy diet costs an average of N1,541 per adult per day, N10 represents less than one per cent of that daily amount.

When policy could not hold prices down

As the economy expanded, monetary policy changed repeatedly, but so did the purchasing power of the naira.

According to the CBN Statistical Bulletin, Volume 14, 2003, when the naira was introduced in 1973, inflation was 5.4 per cent. It rose sharply to 13.4 per cent in 1974 and 33.9 per cent in 1975, before falling to 21.2 per cent in 1976 and 15.4 per cent in 1977.

The CBN said the surge in public expenditure and oil revenues in the early 1970s heightened inflationary pressures and led Nigeria to adopt a monetary-targeting framework in 1974.

The period also saw tighter controls on bank credit and other measures aimed at containing inflation.

Yet, as prices rose, the denominations of the currency also expanded, while policy responses became more aggressive decades later.

By 2024, the CBN Governor, Olayemi Cardoso, said the Bank raised its Monetary Policy Rate by 875 basis points to 27.5 per cent to combat inflation, while also ending deficit financing through Ways and Means advances, which had reached N22.7tn.

Despite these interventions, the experience shows that controlling inflation is not simply a matter of changing interest rates or restricting money supply.

Prices are also influenced by fiscal policy, exchange-rate movements, food and energy costs, supply disruptions and other structural pressures.

The CBN itself has acknowledged that such factors have continued to shape Nigeria’s inflation dynamics.

For the holders of N5, N10 and N20 notes, the consequence has been that while the denominations remained unchanged in face value, the quantity of goods and services they could command steadily declined.

Economists blame scarcity, inflation, low purchasing power

Speaking in an interview with Saturday PUNCH, Professor of Economics at Olabisi Onabanjo University, Sheriffdeen Tella, said the lower denominations might remain legal tender, but their limited availability had contributed to their declining use.

He said, “It is not available; that is why people are adjusting their prices and using items to give back as exchange.”

Similarly, an economic analyst, Dr Akin Akinleye, attributed the development to prolonged inflation, saying rising prices had eroded the usefulness of lower denominations.

He added, “If government refuses to control prices, the prices of items will keep increasing.”

A Fellow of the Chartered Institute of Bankers of Nigeria and Professor of Finance and Economic Development at the University of Abuja, Yekeen Abdul-Maliq, said the declining purchasing power of the lower denominations was responsible for their reduced production and availability.

He said producing banknotes was costly, making coins a more practical option for lower denominations because they lasted longer.

The don added that the growing use of electronic transfers could also have reduced demand for cash.

CBN mum

Efforts to get the Acting Director of Corporate Communications of the CBN, Hakama Sidi-Ali, to comment on the availability of the denominations proved abortive, as calls, SMS and WhatsApp messages sent to her were not responded to as of the time of filing this report.