The Nigerian Naira is the official currency of Nigeria and it is sub-divided into 100 kobo. The Naira and kobo were coined from the word ‘Nigeria’ and the local pronunciation of the word ‘copper’ respectively.
The Naira and Kobo were introduced on the 1st of January 1973 to replace the use of pounds, shillings and pence which were then the official currency of Nigeria. The Naira was exchanging at a rate of 2 naira to 1 pound (2₦ = 1£) when it was first introduced. The Central Bank of Nigeria is the sole body responsible for the disbursement of the Naira and Kobo throughout the country.
The Nigerian currency has two forms; the Coins and Banknotes
Coins were in introduced in Nigeria in 1973 in several denominations of kobo (½k, 1k, 5k, 10k & 25k). The ½ kobo was made only that year, the 1 kobo was made with bronze while the rest denominations were made from Cupro-nickel. Copper-plated-steel were used to replace smaller 1 kobo, 10 kobo and 25 kobo coins in 1991. 50 kobo and 1 naira coins were also introduced using Nickel-plated-steel. New denominations of bimetallic 1 naira and 2 naira coins were issued alongside a new 50 kobo coin on February 28 2007. A deadline of 31st may 2007 was set for the exchange of old currencies, though some Nigerians expressed concerns over the usability of the 2 naira coin that was introduced. The central bank announced that the deadline for withdrawal of the circulation of the ½ kobo to 25 kobo coins will be effective from February 28 2007.
The banknote was introduced by the Central bank of Nigeria on the 1st of January 1973. The banknotes denominations that were introduced are the 50k, 1, 5, 10 and 20 naira. The 50 kobo bank note was last issued in 1989. 50, 100, 200, 500 and 1,000 naira notes were issued in 1991, 1999, 2000, 2001 and 2005 respectively.
New types of 5, 10, 20 and 50 naira banknotes were introduced on the 28th of February 2007. At first the plan was to make the mentioned currencies in polymer banknotes but only the 20 naira was able to be released in polymer form. It was till 2009 that the 5, 10 and 20 naira were issued in polymer banknotes. Subsequently, because of the high cost of polymer notes the central bank has resolved not to issue any other denomination of currency in polymer.