Currency outside banks jumped by 51.06 per cent or N1.57 trillion to N4.65 trillion in November compared with N3.08 trillion in the corresponding period of last year, according to the latest Money and Credit Statistics data released by the Central Bank of Nigeria (CBN) yesterday.
The data also shows that on a month-on-month basis, currency outside banks grew by 8.50 per cent or N364.39 billion in November 2024, compared with N4.29 trillion in the previous month.
Furthermore, the data indicates that the total amount of Currency-In-Circulation (CIC) increased by 7.23 per cent or N328.91 billion to N4.88 trillion in November 2024 from N4.55 trillion in the previous month.
This means that 95.38 per cent of currency in circulation was outside banks in November this year compared with 94.27 per cent, in the previous month, an indication that despite the CBN’s efforts to discourage members of the public from keeping cash outside the banking system, the problem still persists.
The CBN’s Monetary Policy Committee (MPC) has identified the surplus cash in circulation as one of the key drivers of the country’s high inflation, which the apex bank has tried to curb by raising the benchmark interest rate- the Monetary Policy Rate (MPR) by 875 basis points to 27.5 per cent in 2024.
Despite these measures, broad money (M3) in the economy rose to N108.97 trillion in November 2024, compared with N108 trillion in the previous month.
he surge in currency outside banks comes amid growing public concern over the difficulties customers face in trying to withdraw cash over the counter at their financial institutions and from Automated Teller Machines (ATMs).
In response to the situation, the CBN, in September, announced plans to sanction banks that fail to dispense cash through their ATMs.
Also, on November 15, the regulator issued another circular in which it directed DMBs to prioritise cash disbursement through ATMs, stating that it had commenced spot checks to ensure efficient and responsible cash disbursement to the public. The CBN warned that would penalize banks found disbursing naira notes to persons hawking the naira.
Meanwhile, further analysis of the CBN’s latest Money and Credit Statistics data shows that net domestic credit( credit to the private sector plus credit to government rose by 1.86 per cent or N2.11 trillion to N115.58 trillion in November 2024 from N113.46 trillion in October.
Specifically, net credit to government increased marginally by 0.57 per cent or N225.42 billion to N39.62 trillion in November from N39.39 trillion in the previous month.
