The Central Bank of Nigeria (CBN) has disclosed that currency in circulation increased to N2.31trillion in April 2020, over increased bank customers’ withdrawal amid the coronavirus pandemic lockdown.
President Muhammadu Buhari had on March 29, ordered an initial lockdown for 14 days in Lagos, Ogun and Federal Capital Territory (FCT) as one of the measures aimed at containing the spread of the coronavirus disease.
The lockdown was extended for another 14 days in April, forcing increased withdrawal from the banking sector, Western Post can report.
Western Post also gathered that reported figure by the apex bank in April is the highest currency in circulation this year, second-highest amount when the N2.44trillion physical currency was reported in December 2019.
Commenting on increasing currency in circulation, currency analysts hinted that excess liquidity in the economy has leveraged growth in currency in circulation, stressing that Nigerians are finding it difficult to embrace the cash policy of the CBN.
They expressed that Nigeria is still more of a cash economy over infrastructure challenges, stressing that bank customers withdraw cash towards the federal government coronavirus lockdown.
“Someone can blame infrastructure deficit to CBN’s good intention of making Nigeria a cashless society. The infrastructure that will make the cashless policy work is missing compared to what we have in Kenya,” analyst expressed to Western Post.
The apex bank in 2002 introduced the cashless policy to eliminate the amount of physical cash (coins and notes) circulating in the economy, and encouraging more electronic-based transactions (payments for goods, services, transfers, among others.)