Total Amount of Naira in Circulation Falls by 53 Percent as Cash Crunch Worsens in Nigeria

The latest data from the Central Bank of Nigeria (CBN) has revealed that total amount of currency-in-circulation has fallen by 53.33 percent since October last year to January, this year.

The data, contained in a report presented by the CBN Deputy Governor, Folashodun Shonubi, at a forum in Abuja, indicated that the cash in circulation decreased from N3.3 trillion to N1.54 trillion.

It was gathered that the 53.33 decrease in the cash within the public space was due to Nigerians’ high compliance to the order by CbN for bank customers to deposit their old N1000, N500 and N200 notes before the bank’s February 10, 2023 controversial deadline.

Bank customers had thronged commercial banks with the old notes and deposited them with the expectation that the new notes would be within their reach.

Investors King had reported the anguish, pain and hardship that majority of Nigerians are passing through following the scarcity of the new redesigned currency.

The biting shortage of the new naira notes has severely affected commercial activities across the country as small and medium-scale business owners have been lamenting low sales while some have closed up their businesses including Point of Sales operators.

The CBN Governor, Godwin Emefiele, had said one of the objectives of the naira design policy was to mop up currency outside the bank vaults which he put at N2.7tn. He had said with such a huge amount outside the banking system, it would be difficult for monetary policy initiatives to impact the economy.

While citizens lament hardship caused by the naira redesign policy, President Muhammadu Buhari, in an attempt to reduce the problem in getting the naira, had ordered CBN to re-circulate the old N200 notes to the public, and declared that the old N500 and N1,000 banknotes were no longer legal tender in the country.

Since the President gave the new order concerning the N200 old notes, bank customers have complained that the old notes was yet to be released to them.

Customers were seen crowding banks for naira even as some banks remain shut

It could be recalled that some state governors had directed their residents to continue spending the old notes in line with an order of the Supreme Court.

But checks revealed that traders and transporters in several states across the country have insisted on collecting only new naira notes and old N200 note in line with the directive of President Buhari.

Some traders and commercial transporters have been rejecting bank transfer even as online transactions have been problematic for Nigerians.

Many Nigerians have lamented hitches in transacting online as they said that their transactions have not been successful while others use fake alerts for unsuspecting traders.

In the midst of the crisis, Nigerians continue to throng the apex bank to return their old notes while others hold on to theirs with the hope that the Supreme Court judgment would win and ordered the usage of the old currency.

Financial experts have called on the Federal Government to do more in assaulting the suffering of the masses, saying the N200 old notes order could be helpful if it’s made available.