Currency in circulation increases by 0.8% to N2.3trn—CBN

By Ihesiulo Grace

17 October 2019

Business

The Central Bank of Nigeria (CBN) has said Currency-in-Circulation (CIC) rose by 0.8 per cent to N2.3 trillion as at the end of December 2018.

The 2018 Annual Report released by the apex bank through the Currency Operations Department (COD) noted that the increase in circulation reflects the high dominance of cash in the economy and increase in economic activities.

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The report stated that the proportion of higher denomination banknotes – N100, N200, N500 and N1000 in total rose from 41.9 per cent to 44.3 per cent while in terms of value, it rose from 96.9 per cent to 97.6 per cent, while the lower denomination currency notes – N5, N10, N20 and N50 continued to be dominant in terms of volume compared to higher notes as it constituted 55.7 per cent of the total, while in value terms, it constituted only 2.4 per cent of the total banknotes.

The ratio of CIC to nominal GDP, which measures the moneyness of the economy recorded slight falls by 0.1 percentage point to 1.8 per cent in the period under review and according to the report, this decline occurred as a result of increase in e-payment products such as electronic payment cards.

The report, also, indicated that the COD during the period under review recorded significant progress in the accomplishment of its strategic objectives, which included: development of a Clean Notes Policy and Banknote Fitness Guidelines; the tiered pricing for the processing of lower denomination banknotes, an increased volume of issuable banknotes and effective distribution of banknotes.

It also registered more Cash-In-Transit (CIT) and Cash Processing Companies (CPC), which encouraged private sector participation; commissioning of the temporary exhibition “Naira Our National Pride” for public enlightenment on a banknote basic security features.

Other noteworthy achievements made in 2018 include the development of the Cash Activity Reporting Portal (CARP) for transmission of the financial industry currency management data to Nigeria Inter-Bank Settlement System (NIBSS); approval granted by management for the establishment of mobile courts, in collaboration with Legal Services Department (LSD), for the speedy prosecution of suspects apprehended for currency-related offences, and a pilot run on recycling of banknotes waste into re-usable materials to reduce its carbon footprints and comply with environmental sustainability practices.