It's not enough to say I know my customers, their preferences and buying patterns.

What about how much they actually have in hand to buy directly from you without you offering your goods out on credit.

The total sum of money in circulation stood at 2.16 trillion naira as at December 2017.

But even since, it has been on a consistent decline.

In June, the currency in circulation fell for the third consecutive month, with economic experts describing it as a positive trend for the nation’s inflation.

Data obtained from the Central Bank of Nigeria, CBN showed that the currency in circulation dropped by 30 billion naira to 1.90 trillion naira as of June 30, 2018 from 1.93 trillion naira on May 31.

The total sum in circulation stood at 2.04 trillion naira and 1.96 trillion naira in March and April.

Also Read: 3 Things To Know If You Want To Benefit From Nigeria-China Currency Deal

A professor of Economics at Olabisi Onabanjo University, Ogun State, Sheriffdeen Tella, told Punch that the reduction in the currency in circulation could be attributed to three factors.

He said: “First, the CBN is trying to mop up liquidity, so it may have cut down supply of currency into the economy. Secondly, people are moving their money out of the economy because of the exchange rate in the United States in order to buy foreign currency.

“Thirdly, politicians are stocking money for elections; they are not spending yet. These are the three main reasons that can account for the fall in the currency in circulation.”

According to Tella, though it is good that the CBN is tackling liquidity, there may be adverse effects on the economy.

“Too little currency in the economy will affect investment because investors need money to invest in the economy,” he said, adding that there was a need to do things moderately and encourage transactions to facilitate economic growth.

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