Cash Scarcity: CBN Blames Hoarding, Says N3.4trn In Circulation, Surpassing Pre-redesign Level

Amidst reports of cash scarcity in major Nigerian cities, the Central Bank of Nigeria (CBN) announced a surge in currency in circulation (CIC), reaching a record high of N3.4 trillion by December 11, 2023.

This surge, marking a 13.71% increase from October 2023, surpasses the pre-redesign levels of October 2022.

The CIC comprises currency outside the banking system and bank vault cash. Despite the assurance of adequate cash availability, the CBN attributed the ongoing scarcity to hoarding behavior, stemming from apprehensions surrounding the Naira redesign project’s challenges.

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Sidi Ali of the CBN clarified that while the circulation stood at N1 trillion in February 2023, it had surged to over N3.4 trillion in December 2023, indicating ample cash availability.

However, individuals’ reluctance to release hoarded currency due to prior experiences has contributed to the scarcity.

As the holiday season approaches, the CBN urged patience, emphasizing the need to explore alternative transaction methods beyond cash.

The institution is striving to mitigate the scarcity and ensure cash availability, encouraging Nigerians to adopt diverse payment options.