The Real Cause of Naira Scarcity, According to CBN

The Real Cause of Naira Scarcity, According to CBN

The hoarding of the new naira by Nigerians, according to the Central Bank of Nigeria (CBN), is the cause of its shortage.

This was said by Mrs. Rashidat Mongunu, Director of Consumer Protection for the CBN, on Thursday while inspecting microfinance institutions in Offa, Offa Local Government Area, Kwara.

According to NAN, the monitoring team first paid respects to Oba Mufutau Gbadamosi, the Olofa of Offa, before visiting Stockcorp Microfinance and Ibolo Microfinance banks.

The CBN director claimed that while the CBN made the redesigned notes available in the appropriate amount, individuals hoarding them are to fault for the currency shortage, which is made worse by the huge volume of people swarming banks to withdraw cash practically simultaneously.

“Because of the attitude of some Nigerians in hoarding the money, even those that don’t really need the money are rushing to get it and keep it, not to spend,” she said.

She stated, in reference to the currency management cycle: “We have not allowed the cycle to mature because, when the CBN issues currency, our expectation is that the naira issued will return to the banking system once more.

However, everyone who is currently collecting naira is hoarding it.
Therefore, no matter how much naira we distribute, if we maintain this mentality and the CBN keeps printing money from now until December, it still won’t be enough.

Monguno added:

“In every economy, you must have proper accountability. You just don’t issue Naira for the fun of it, you issue the amount that is commensurate with the level of activity you have in that country.”