The Director of Currency for the Central Bank of Nigeria (CBN), Rasheed Adams, has disclosed that the financial regulator has received more deposits than it projected since the apex bank urged Nigerians to deposit old naira hoarded from the banking system.
According to Adams, the central bank has recorded N165 billion in deposits, although he said the amount is still small considering the naira notes outside the banks.
The rise in deposits is driven by the decision of the central bank to redesign the naira. As a result, many Nigerians that have kept the local currency out of the bank are taking the money back.
Persons with the old naira have been urged to deposit their money to the bank before January 31, 2023, as the central bank insists on not extending the deadline to phase out the old notes.
A week ago, Prime Business Africa reported that CBN’s Director of Corporate Communications, Ostia Nwanisobi, hinted deposits have risen significantly, however, he didn’t provide details.
“The CBN is pleased to note the positive response of the banking public to the policy through increased currency deposits across banks and other financial institutions,” Nwanisobi said in a statement.
He added, “CBN remains committed to the seamless implementation of the initiative to ensure the achievement of its objectives to preserve the integrity of the local legal tender by reducing the significant amount of cash outside the banking system and its use in criminal activities, curtail counterfeiting, and promote financial inclusion, among others.”
PBA had reported that only N600 billion is in the vault of commercial banks, with N2.7 trillion outside the financial system of Nigeria out of the N3.3 trillion currency in circulation.
Speaking about the funds outside the bank, CBN governor, Godwin Emefiele, said in October, “To be more specific, as at the end of September 2022, available data at the CBN indicates that N2.7 trillion out of the N3.3 trillion currency in circulation was outside the vault of commercial banks across the country and supposedly held by members of the public.”
Meanwhile, the rise in deposits recorded by CBN comes as the total money supply in the economy rose to N50.5 trillion as of October 2022, from the N44.4 trillion it closed last year.