Volume and Cost of Foreign Exchange Procurement Declined in 2020

The Central Bank of Nigeria revealed that volume and cost of foreign exchange procurement declined critically during the pandemic year in 2020.

The apex bank explained that $1.38 billion was purchased during the time interval, which indicated a 53.67 per cent decline in contrast to the $3.59 billion procured in 2019.

Furthermore, the CBN trimmed its currency printing expenditure by 28.85%, falling from N75.52 billion in 2019 to N58.61 billion in 2020. This report was published by Currency Operations Department of the Central Bank of Nigeria.

According to the central bank, currency printing downed to N64.04 billion in 2018. Sources said the depletion was intertwined with the policy to reduce the cost of printing banknotes and cash management, in the country, instigated by Gov Godwin Emefiele

The eNaira, Africa’s first digital currency which was launched by Muhammadu Buhari, is also a development to further reduce the cost of printing Naira.

Reports from the CBN suggest that total stock of currency (issuable and non-issuable) in the vaults of the CBN stood at 2.75 billion as at December 2020 compared to 2.64 billion pieces in 2019

In the period under review, total issuable notes were 592.94 million pieces, compared with 726.43 million pieces in 2019, representing a decrease of 133.49 million pieces or 18.38 per cent.

The central bank said it generated the sum of N6.50 billion as total income from currency management activities in 2020, compared with N13.24 billion in the preceding year, representing a decrease of N6.74 billion or 50.92 per cent.

The bank explained that the income generated was, largely, from penal charges on unsorted banknotes deposited by Deposit Money Bank (DMBs) and charges for authentication of foreign currency deposits with the Central Bank.

The CBN, however, incurred a total of N67.21 billion as expenses on currency operations in 2020, representing a decrease of N17.96 billion or 21.08 per cent, less than N 85.18 billion in 2019.

Irrespective of the COVID-19 outbreak the apex bank  finalized its upgrade of cash activity reporting portal for transmission of currency management data from the financial industry to the Nigeria Inter-Bank Settlement System.