Currency in Circulation Crosses N3trn Mark in November
The Central Bank of Nigeria (CBN) has disclosed that the currency in circulation grew by 6.2 per cent from N2.97trillion in October to N3.15trillion in November 2021.
Currency in circulation hits the historical N3trillion mark in November 2021 as banks customers withdraw physical cash amid festive period.
THISDAY gathered that currency in circulation in its Year-till-Date and Year-on-Year gained 11per cent and 18 per cent respectively.
The apex bank on its official website reported N2.84 trillion currency in circulation for the month of September.
Commenting, analyst and finance expert, Mr Rotimi Fakeyejo hinted that excess liquidity in the “Ber” months contributed to growth in currency in circulation, stressing that Nigerians are finding it difficult to embrace the cashless policy of the CBN.
According to him: “The market currently is awash with excess liquidity and it is due to season of the year. CBN interventions in the foreign exchange and other key sectors of the nation’s economy are factors contributing to hike in currency in circulation.”
He explained further that Nigeria is still more of a cash economy, facing infrastructure challenges.
“Someone can blame infrastructure deficit to CBN’s good intention of making Nigeria a cashless society.
The infrastructure that will make the cashless policy work is missing compared to what we have in Kenya,” he explained.
In August, the currency in circulation had fallen to N2.78trillion from N2.81trillion in July. In June, it was N2.74trillion and in May, N2.79trillio. It stood at N2.79trillion in April and N2.8trillion in March.
It amounted to N2.78trillion and N2.83trillio in February and January respectively.
According to the CBN, the currency in circulation had increased by N465.47billion or 19.06 per cent, from N2.44trillion in 2019 to N2.91trillion in 2020.
“In 2020, there were higher withdrawals by DMBs than deposits, due to the panic need to hold cash to deal with the emergencies and reduced banking hours due to restrictions to curb spread of the pandemic,” the CBN said.
The apex bank said it developed and unveiled a clean note policy and banknote fitness guidelines in 2018 to preserve public trust and maintain the quality of circulated notes in the economy.
The guidelines provide a blueprint of quarterly and yearly activities to ensure that this objective was achieved.
According to the apex bank, the policy provides that every newly printed and existing banknotes should measure up to predefined standards before circulation and re-circulation in the economy.