Why There Is Not Much Cash In Circulation In Nigeria
If you have been wondering why there isn’t much physical cash in circulation, it is because the currency in circulation in Nigeria has fallen.
The currency in circulation dropped by 75.84 billion naira from 1.9 trillion naira in June to 1.824 trillion naira in July 2018.
According to statistics from the Central Bank of Nigeria, CBN on Wednesday, the figure rose from 1.93 trillion naira in February to 2.03 trillion naira in March.
The CBN revealed that the currency in circulation fell to 1.95 trillion naira and 1.93 trillion naira in April and May, respectively.
Commenting on factors that could affect currency in circulation, the Chief Executive Officer, Economic Associates, Dr Ayo Teriba, said one reason was the growth of electronic payment, such as increase in the use of Automated Teller Machines, Point of Sale and domestic fund transfer rather than using cash.
“The e-money is displacing the naira on the retail front as a means of payment, as a store of value, foreign currency is replacing the naira. So that trend may continue until you have a negligible amount of naira in circulation,” he said.
He said people no longer needed to stock up cash to pay for things, because they could go to the supermarket, restaurant or any shop and pay with their bank card.
Teriba said, “Instead of giving people cash, you can transfer, so many of the things that you needed to use cash for in the past you don’t need currency for them now. Electronic money is displacing cash at the retail end.”
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