• Business - Economy
  • Updated: March 20, 2023

Find Urgent Solution To Naira Scarcity — Experts To CBN

Some financial experts have urged the Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) to take urgent steps to address the shortage of cash in the country.

The experts spoke to the News Agency of Nigeria (NAN) on Monday in Abuja, against the backdrop of the 290th meeting of the MPC.

The meeting is scheduled to hold on Monday and Tuesday.

According to Okechukwu Unegbu, a financial expert, the MPC should discuss the cash situation as a matter of priority.

Unegbu, a past president of the Chattered Institute of Bankers of Nigeria (CIBN), said that the apex bank’s claim of circulating more than N900 billion did not reflect on the Nigerian economy.

He, however, said that the problem would likely ameliorate as elections had been concluded in the country.

“Our biggest challenge presently is the cash situation, and I think the committee should discuss it as a matter of urgency.

“The CBN says it has over N900 billion in the system, but it is not reflecting because cash is still scarce.

“But I believe that with the elections over, cash will start to circulate,’’ he said.

He urged the committee to also address the “rumblings in the economy’’ in terms of inflation and exchange rates.

On the policy rates, Unegbu advised for retention of all existing parameters until the next meeting.

“I suspect that because of rising inflation, which is now 21.91 per cent, according to the National Bureau of Statistics (NBS), the MPC may be tempted to raise the rates again.

“But my suggestion is that all the rates should be held constant to allow the MPC study the situation until its next meeting,’’ he said.

Another financial expert, Muktar Muhammed, urged the apex bank to explain to Nigerians the reasons why Naira notes are still scarce.

On policy expectations, Muktar said the MPC would have liked to increase the prevailing rates but could be discouraged by the already high inflation rate.

Ordinarily, we could see a hike in rates but as it stands now, because of the Naira shortage and what it has done to the economy, I do not think they will want to do that.

“Again, inflation is already high and I do not see how hiking rates, alongside the cash shortage, will help the economy grow better,’’ he said.

According to Uche Uwaleke, a Professor of Capital Market at the Nasarawa State University, Keffi, the use of cash scarcity to stifle demand is not a sustainable way to tackle inflation.

Uwaleke said that such a step could hurt economic growth and could lead to loss of jobs thereby, fuelling unemployment.

“Going forward, the CBN should ensure that measures are put in place to ease the cash crunch while gradually implementing its cashless policy," he said.


Related Topics

Join our Telegram platform to get news update Join Now
Felicia Abisola  Olamiji
Felicia Abisola Olamiji

  A graduate of English Language from Olabisi Onabanjo University, passionate about learning new...

More From this Author


aso savings and loans plc Financial Services

Aso Savings & Loans (ASO) is a Nigerian based mortgage bank, it was incorpor...

wema bank plc Financial Services

africa prudential plc Financial Services

Africa Prudential Plc is a leading Registrar, Investor Services and Business sup...

sterling bank plc Financial Services


0 Comment(s)


See this post in...