RateCaptain
  • Home
    • About Us
    • Contact Us
  • FX Rates
  • Money Market
  • Cryptocurrency
  • Commodities
  • Corporates
No Result
View All Result
Subscribe
  • Home
    • About Us
    • Contact Us
  • FX Rates
  • Money Market
  • Cryptocurrency
  • Commodities
  • Corporates
No Result
View All Result
RateCaptain
No Result
View All Result
Home Banking

Resurgence of Cash Hoarding in Nigeria Raises Concerns.

Rate Captain by Rate Captain
May 23, 2023
in Banking, Currencies
Reading Time: 2 mins read
A A
0
Confusion deepens as the uncertainty of the old naira deadline persists.
Share on FacebookShare on TwitterShare on WhatsappShare on Telegram

Following the relaxation of currency redesign and cashless measures by the Central Bank of Nigeria (CBN), indications suggest that Nigerians have resumed cash hoarding. Recent findings show a significant increase in currency outside banks (COB), reaching N2.08 trillion. This surge comes after monetary measures implemented by the CBN had initially helped reduce the amount of cash held outside the banking system. As the government halted these measures, COB decreased to N1.45 trillion by March. However, the latest data reveals a sharp rise of 43 percent in COB to N2.08 trillion in April, indicating a concerning trend of cash hoarding.

Policy Reversal and Cash-in-Circulation:

AlsoRead

Nigerian Banks Face N3.77 Trillion in Loan Losses Since 2023

CBN Crackdown: Nigerian Banks Face Dividend Freeze Until 2028

Nigerian Banks Brace for Profit Squeeze as CBN Phases Out Forbearance Measures

In December of the previous year, the CBN introduced redesigned N200, N500, and N1,000 notes, setting January 31st as the deadline for the old notes to cease being legal tender. The objective of the policy was to mop up currency outside banks, which stood at N2.83 trillion in October when the redesign announcement was made. Within five months, the CBN successfully reduced COB by 135 percent to N843.3 billion in February. Currency-in-circulation (CIC) also decreased by 235 percent to N982 billion during the same period. However, a Supreme Court ruling in March extended the legal tender status of the old notes until December 31st, 2023, leading to a significant rise in both COB and CIC.

Concerns and Calls for Action:

The resurgence of cash hoarding raises concerns among experts in the security industry. As the incoming government of President-elect Bola Tinubu prepares to take office, they emphasize the need to focus on industrializing the country and deliberate on strengthening the security architecture. Cash hoarding can have adverse effects on the economy, including reduced circulation of money within the formal banking system and potential challenges in monetary policy implementation. Additionally, the security implications of increased cash outside the banking system warrant attention, as it can be associated with illicit activities and undermine efforts to combat financial crimes.

Bottom line

The recent surge in currency outside banks in Nigeria highlights the resumption of cash hoarding following the relaxation of currency redesign and cashless measures. While the initial policy aimed to reduce COB and enhance monetary stability, the reversal has led to a significant increase in cash held outside the banking system. As the incoming government takes charge, it is crucial to prioritize efforts to industrialize the country and address security concerns. By promoting economic development and strengthening the security architecture, Nigeria can work towards a more robust financial system and a safer society.

Tags: cash circulationcash hoardingcash-in-circulationcashless measuresCentral Bank of NigeriaCOBcurrency outside bankscurrency redesigneconomic developmentfinancial crimesfinancial systemformal banking systemgovernment policyillicit activitiesindustrializationlegal tendermonetary measuresmonetary policy implementationmonetary stabilityNigeria's economyPresident-elect Bola Tinubusafer society.security architecturesecurity concernsSupreme Court ruling
Previous Post

CBN Monetary Policy Committee to Address Interest Rates Amidst Economic Challenges

Next Post

Uber Partners with Waymo to Introduce Self-Driving Cars, Advancing Autonomous Driving.

Related News

Liquidity Crunch: Banking Sector’s Borrowing from CBN Surges to N12 Trillion.

Nigerian Banks Face N3.77 Trillion in Loan Losses Since 2023

by Jide Omodele
June 17, 2025
0

Ten commercial banks listed on the Nigerian Exchange (NGX) have collectively incurred N3.77 trillion in loan impairment charges from 2023...

CBN’s Recapitalization Budget of $1 Trillion Sparks Debate Among Industry Stakeholders

CBN Crackdown: Nigerian Banks Face Dividend Freeze Until 2028

by Stephen Akudike
June 17, 2025
0

A recent Renaissance Capital (Rencap) research note, titled “Nigerian Banks, Cash is King,” has shed light on the significant exposure...

NEC Affirms CBN $3 Billion Loan for Naira Stability

Nigerian Banks Brace for Profit Squeeze as CBN Phases Out Forbearance Measures

by Stephen Akudike
June 16, 2025
0

The Central Bank of Nigeria (CBN) has initiated a gradual rollback of forbearance measures introduced during the COVID-19 pandemic, signaling...

NEC Affirms CBN $3 Billion Loan for Naira Stability

CBN Stands Firm on BDC Recapitalisation Deadline, Rejects Extension Rumors

by Stephen Akudike
June 12, 2025
0

The Central Bank of Nigeria (CBN) has categorically dismissed reports suggesting an extension of the recapitalisation deadline for Bureau De...

Next Post
Uber Partners with Waymo to Introduce Self-Driving Cars, Advancing Autonomous Driving.

Uber Partners with Waymo to Introduce Self-Driving Cars, Advancing Autonomous Driving.

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recommended

DMO Announces Subscription Offering for Federal Government Savings Bonds.

Nigeria Launches N50 Billion Green Bond to Fund Climate-Friendly Projects

June 17, 2025
EFCC Launches Task Force to Combat Naira Mutilation and Dollarization

EFCC Arraigns Precious Williams for Alleged N13.8 Billion Ponzi Scheme Fraud

June 17, 2025

Popular Story

  • World Bank Extends Nigeria’s Digital Identification Project Deadline Amid Missed Targets

    Nigeria Loses $4M World Bank Loan Due to Audit Failure

    0 shares
    Share 0 Tweet 0
  • Fair Money Job Opening: Regional Sales Manager

    0 shares
    Share 0 Tweet 0
  • BlackRock Joins Blockchain Platform Axoni for Equity Swap Trades

    0 shares
    Share 0 Tweet 0
  • Cooking Gas Price Surges to N800/KG, Amplifying Hardships.

    0 shares
    Share 0 Tweet 0
  • Nigerian Equity Market Rebounds with ₦369 Billion Gain

    0 shares
    Share 0 Tweet 0
RateCaptain

RateCaptain

We bring you the most accurate in new and market data. Check our landing page for details.

  • Home
  • About Us
  • Privacy Policy
  • Terms & Conditions
  • Disclaimer
  • Cookie Policy
  • Contact Us

Copyright © 2022 RateCaptain - All rights reserved by RateCaptain.

No Result
View All Result
  • Home
    • About Us
    • Contact Us
  • FX Rates
  • Money Market
  • Cryptocurrency
  • Commodities
  • Corporates

Copyright © 2022 RateCaptain - All rights reserved by RateCaptain.

RateCaptain
Manage Cookie Consent
To provide the best experiences, we use technologies like cookies to store and/or access device information. Consenting to these technologies will allow us to process data such as browsing behavior or unique IDs on this site. Not consenting or withdrawing consent, may adversely affect certain features and functions.
Functional Always active
The technical storage or access is strictly necessary for the legitimate purpose of enabling the use of a specific service explicitly requested by the subscriber or user, or for the sole purpose of carrying out the transmission of a communication over an electronic communications network.
Preferences
The technical storage or access is necessary for the legitimate purpose of storing preferences that are not requested by the subscriber or user.
Statistics
The technical storage or access that is used exclusively for statistical purposes. The technical storage or access that is used exclusively for anonymous statistical purposes. Without a subpoena, voluntary compliance on the part of your Internet Service Provider, or additional records from a third party, information stored or retrieved for this purpose alone cannot usually be used to identify you.
Marketing
The technical storage or access is required to create user profiles to send advertising, or to track the user on a website or across several websites for similar marketing purposes.
Manage options Manage services Manage {vendor_count} vendors Read more about these purposes
View preferences
{title} {title} {title}
?>