The Central Bank of Nigeria (CBN) is under fire following a staggering 21,400% increase in currency issue expenses, soaring from ₦1.11 billion in 2023 to ₦238.65 billion in 2024, according to some media reports.
These costs, encompassing the printing, processing, distribution, and disposal of naira notes, have sparked widespread debate about fiscal management amid Nigeria’s ongoing economic challenges, including a historic currency crisis and 35% inflation rate by late 2024.
The dramatic rise is largely attributed to the CBN’s 2022-2023 naira redesign policy, which aimed to curb vote-buying and promote a cashless economy but led to a severe cash shortage, public protests, and a Supreme Court ruling extending the validity of old notes. The redesign necessitated mass printing and distribution of new notes while recalling old ones, significantly inflating costs. Additionally, the naira’s devaluation—losing 70% of its value since May 2023—likely increased the cost of importing paper and security features for printing, as Nigeria relies heavily on foreign suppliers.
Comparatively, other countries manage currency production more cost-effectively. The U.S. Federal Reserve reported $1.1 billion (approximately ₦1.7 trillion at 2024 rates) in 2023 for printing and distributing 7.1 billion notes, serving a $21 trillion economy.
The European Central Bank spent €1.2 billion (₦2 trillion) in 2023 for euro notes across 20 countries, with advanced automation reducing costs.
India spent ₹49 billion (₦90 billion) in 2023 on currency operations, leveraging domestic production to minimise expenses.
Nigeria’s ₦238.65 billion for a $477 billion economy raises questions about efficiency, given its smaller GDP and note circulation volume.
Critics argue that Nigeria’s high costs reflect poor planning and over-reliance on foreign inputs, exacerbated by corruption and mismanagement. The CBN’s push for the eNaira digital currency, which cost millions but saw low adoption, further strains resources. Meanwhile, countries like China and India integrate digital currencies with lower physical currency costs, suggesting a path Nigeria could explore.
As public discontent grows, with some Nigerians calling for CBN Governor Olayemi Cardoso’s resignation, the bank faces pressure to enhance transparency and adopt cost-saving measures like localised production. Without reform, Nigeria risks further economic strain, undermining trust in its monetary system.
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