The scarcity of the Naira in Nigeria, which is a result of the Central Bank’s redesign and cash withdrawal policy, has skyrocketed point-of-sale (POS) transactions to N807.16 billion in January 2023.
This information was disclosed in the data from the Nigerian Inter-Bank Settlement system.
The data collected by the NIBSS shows that total cashless transactions rose by 45.41 percent year-on-year to N39.58 trillion in January 2023, while total point-of-sale terminals increased by 40.69 percent year-on-year from N573 billion to 807 billion during this same period.
In 2022, the CBN announced a Naira redesign policy, set withdrawal limits, and encouraged Nigerians to adopt electronic forms of transactions. The CBN said, “The maximum weekly limit for cash withdrawals across all channels by individuals and corporate organizations shall be N500,000 and N5 million, respectively.”
It added, “Customers should be encouraged to use alternative channels (Internet banking, mobile banking apps, USSD, cards/POS, E-Naira, etc.) to conduct their banking transactions.”
Implementation of the policy has been postponed from its initial January 31 deadline to February 10. This new deadline is now subject to a Supreme Court judgment that has restrained the federal government from implementing it. Since the policy was announced, Nigerians have been subject to long ATM queues, the buying of the naira, failed transactions, and problems with banks’ mobile applications. Banking halls across the country have emptied as frustrated customers resort to other means of cash withdrawal. Riots have also broken out in various states of the country over the naira’s scarcity, and angry Nigerians have attacked banks in some locations.
According to the National President, of the Association of Mobile Money and Bank Agents in Nigeria, Victor Olojo, the cashless policy has forced people to go digital.
He said, “The cashless issue forced people to move to digital, to POS.” The policy contributed to that growth. People had to seek alternative channels aside from cash, so this is expected. However, this is not all from POS withdrawals; we have merchants, businesses, and supermarkets. “All other sectors using POS to transact contributed to it.”
Commenting on how POS operators have been accessing cash, he added, “Cash has also not been available to operators; most of them have shut down. “And those who are getting cash are seeking it from other alternatives, such as marketplaces, filling stations, and pharmacies, and they get it at a cost.”
