Nigeria incurs N315 billion in foreign money administration price

The Central Bank of Nigeria (CBN) reported a pointy rise in foreign money administration prices in 2024, with bills growing by over 300% amid the extended money shortages that rattled the economic system throughout the yr.

In accordance with the apex bank’s newest audited monetary assertion, foreign money concern bills on the Bank degree rose to N315.18 billion in 2024, representing a 305.7% enhance in comparison with N77.67 billion in 2023.

Equally, on the Group degree, prices jumped dramatically to N238.65 billion from simply N1.11 billion within the earlier yr, an unprecedented spike that highlights the dimensions of intervention efforts.

Foreign money concern bills cowl the printing, processing, distribution, and disposal of foreign money notes.

The CBN defined that the surge displays the operational calls for of managing money provide throughout the nation, particularly in periods of acute shortages.

The surge comes towards the backdrop of a serious money disaster that swept throughout Nigeria throughout early 2024, largely linked to disruptions following the naira redesign coverage initiated in late 2022.

Whereas the coverage aimed to drive monetary inclusion and scale back cash-related crimes, it inadvertently triggered important money shortages, forcing the CBN to ramp up foreign money manufacturing and logistics operations to stabilise the monetary system.

The apex bank’s foreign money operations concerned not simply the mass printing of recent notes but in addition the retrieval and destruction of outdated notes, a course of that attracted excessive operational prices on account of nationwide distribution challenges.

Banks sanctioned for money administration failures 

Regardless of a number of emergency measures deployed by the CBN, together with obligatory ATM loading directives and public money shortage hotlines, queues at ATMs and money entry difficulties persevered effectively into early and late 2024.

The apex bank additionally ramped up enforcement efforts towards Deposit Cash Banks (DMBs), sanctioning non-compliant establishments and strengthening money distribution oversight throughout city and rural areas.

• The stress on banks to make sure money availability intensified in 2024, resulting in hefty penalties for a number of monetary establishments. Three main banks—Guaranty Trust Bank, Fidelity Bank, and Access Bank—paid a mixed N192.68 million in fines for numerous infractions linked to money distribution failures.
• GTBank bore the most important penalty, paying N160.40 million following infractions uncovered throughout the CBN’s Thriller Procuring Train. Fidelity Bank was fined N27.28 million, whereas Access Bank paid N5 million over points associated to the dealing with of unfit or hoarded Naira notes.
• In early 2025, the CBN additional fined 9 business banks a mixed N1.35 billion (N150 million every) for failing to adjust to money availability directives throughout the 2024 yuletide season. Affected banks included Fidelity Bank, First Bank, Keystone Bank, Union Bank, Globus Bank, Providus Bank, Zenith Bank, United Bank for Africa, and Sterling Bank.

In accordance with the CBN, the sanctions had been a part of a zero-tolerance coverage for lapses that disrupted public entry to money throughout peak demand intervals.

What you need to know 

Knowledge from the CBN’s Cash and Credit score Statistics confirmed that foreign money outdoors banks surged by 49.3% to N5.13 trillion as of December 2024, up from N3.43 trillion a yr earlier.

Equally, the overall foreign money in circulation rose to N5.44 trillion in December 2024, reflecting a 49.0% year-on-year enhance. Foreign money outdoors banks accounted for 94.2% of whole money in circulation, indicating that regardless of the CBN’s push for digital adoption, bodily money remained dominant, particularly throughout the casual sector and rural areas.

The over 300% rise in foreign money bills uncovered the excessive price of Nigeria’s foreign money administration framework and abrupt financial coverage shifts.

• Regardless of the excessive prices related to foreign money administration, the CBN posted a surplus in its 2024 monetary yr, reversing a deficit recorded in 2023.
• The bank attributed the turnaround to tighter operational management, stronger portfolio inflows, improved diaspora remittances, higher exterior reserve administration, which rose from $36.6 billion in 2023 to $38.8 billion in 2024, and recoveries from previous intervention programmes.
• Nevertheless, liquidity administration bills jumped from N1.5 trillion in 2023 to N4.5 trillion in 2024, because the CBN intensified Open Market Operations (OMO) to curb inflationary pressures amid fiscal injections. Losses from settled by-product contracts additionally rose sharply to N13.9 trillion, reflecting efforts to clear inherited overseas trade obligations.

Regardless of these challenges, the CBN mentioned its 2024 monetary outcomes mirrored deliberate reforms to strengthen governance, transparency, and operational self-discipline, with the goal of supporting Nigeria’s broader financial restoration.