The old 200 naira ($0.43; £0.36) notes will continue to be legal tender for another 60 days, according to President Muhammadu Buhari, who made the announcement in an effort to ease tensions over a cash shortage in Nigeria.
As people fought for access to newly designed banknotes, there have been violent protests recently.
It was supposed to be last Friday when old cash had to be turned in.
However, not enough new notes have been issued, leaving many people short on cash to cover essential expenses.
Elections are scheduled for February 25, and Mr. Buhari has been urged to act to protect the votes of the All Progressives Congress (APC), which is currently in power.
Mr. Buhari attributed the challenges with implementing the new policy to "unscrupulous officials in the banking industry" in a televised speech.
Mr. Buhari said, "I am deeply saddened and sincerely sympathize with you all over these unintended consequences.
However, Mr. Buhari stated that the old 500 and 1,000 naira notes could only be exchanged at the central bank and other designated locations. Nigerians currently have until April 10 to use the old 200 naira notes.
Nigerians have experienced lengthy lines at the cash registers, and some have even camped out in front of banks in an effort to get money first.
People claim that in a nation where cash is still widely used, they have been forced to skip meals and are unable to pay for necessities like bus or taxi fares. A whopping 40% of people reportedly lack access to bank accounts.
Mr. Buhari stated in his speech that the goal of the currency redesign was to combat inflation, illicit financial flow, and insecurity, particularly the funding of "terrorism" and kidnapping for ransom.
He also made mention of worries that some politicians had amassed large sums of money in order to buy votes prior to the elections, and claimed that the currency redesign had put an end to that plan.
In order to support the candidates of their choice in the general election, Mr. Buhari urged voters to cast their ballots.
At the conclusion of his two terms, he is resigning. Bola Tinubu of the APC and Atiku Abubakar of the People's Democratic Party (PDP) are the leading candidates for the position of president; Peter Obi of the Labour Party is viewed as the race's wild card.