According to data obtained from the financial regulator on Sunday, the Central Bank of Nigeria (CBN) continues to mop up currency in circulation, leaving the economy with N982.09 billion.
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The Naira in circulation at the end of October 2022 was N3.29 trillion before the CBN began its Naira redesign policy, which resulted in a scarcity of banknotes.
The central bank complained about the currency in circulation, according to Ripples Nigeria, with CBN governor Godwin Emefiele attributing it to soaring inflation.
Emefiele announced in the last week of October that the CBN would begin to mop up funds in order to reduce the amount of cash in circulation.
The redesign of the old N200, N500, and N1,000 notes is part of its strategy to reduce cash in circulation, with the new banknotes being released in December 2022 and the old notes being phased out on February 10, 2023.
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Despite the Supreme Court’s rulings on February 8, 15, and 22 that the old Naira notes are still legal tender, the central bank continued to mop up the old Naira in circulation, removing N2.3 trillion from circulation between October 2022 and February 2023 while printing fewer new notes.
This was one of the factors that contributed to the Naira’s scarcity, which continued into March despite a Supreme Court ruling on March 3, 2023, that the old Naira remained legal until December 31, 2023.
Between October of last year and February of this year, the amount of cash in circulation fell by 70.14 percent, from N3.29 trillion to N982.09 billion.
Despite the ruling that new and old notes should co-exist for 10 months, Nigerians can still not access money deposited in their accounts as cash in circulation falls and currency in commercial bank vaults or the CBN rises.
