Study of the Effect of Naira Redesign Policy on Small Business Operations in Adamawa State

The 2023 Naira redesign policy created acute cash shortages that disproportionately affected cash-dependent small businesses in northern Nigeria, and examining its effects on business operations in Adamawa State provides evidence for evaluating currency policy design. This study examined the effect of the 2023 Naira redesign policy on small business operations in Yola North, Girei, and Mubi North Local Government Areas, Adamawa State. A survey of 200 small business operators was conducted during and immediately after the policy period. Data collected covered business revenue changes, cash transaction difficulties, customer losses, mobile payment adoption, and operational disruptions. Descriptive statistics and paired t-tests comparing pre-policy and policy-period metrics were applied. Results showed that 78 percent of surveyed businesses experienced revenue declines averaging 43.2 percent during the acute cash shortage period. Daily transaction values fell by 62 percent at the peak of the cash scarcity. Mobile payment adoption increased from 18 percent to 41 percent among sampled businesses, though 34 percent reported customer rejection of digital payment options. Business closure (temporary or permanent) occurred in 21 percent of cases. Rural-area businesses experienced longer and more severe disruptions. The study concludes that the policy's implementation created severe short-term disruptions to small business operations in Adamawa State, particularly in rural communities. Recommendations include extended transition timelines for currency redesigns, prior digital payment infrastructure investment, and small business compensation mechanisms for policy-induced economic losses.

Keywords: Naira redesign, small business, Adamawa State, currency policy, business disruption