Nigeria: Cash circulation steadies as CBN tightens oversight

The Central Bank of Nigeria (CBN) has stepped up efforts to strengthen operational discipline across the financial system, with renewed emphasis on ensuring steady cash availability nationwide. The measures, aimed at restoring confidence and reliability in cash management, are beginning to deliver visible results for Nigerians who depend on physical currency for daily transactions.

A key milestone was the creation of a special committee to tackle Nigeria’s recurring cash scarcity challenges. Chaired by CBN Governor Olayemi Cardoso, the committee was mandated to conduct a comprehensive review of the entire cash ecosystem and propose durable, system-wide solutions. Its work has since translated into tangible improvements.

For the first time in several years, Nigerians passed through the Christmas and New Year period without widespread complaints of cash shortages. Unlike previous festive seasons characterised by long queues and uncertainty, bank customers reported easier access to cash through branches, Automated Teller Machines (ATMs), and other channels, signalling a marked shift in outcomes.

Traditionally, the yuletide season in Nigeria has been associated with acute naira scarcity, often spilling into the new year and disrupting commerce. Customers struggled with empty ATMs, overcrowded banking halls, and limited Point of Sale (PoS) services. That pattern now appears to be easing.

Following the Cardoso-led review, the CBN rolled out measures to address structural bottlenecks in cash production, distribution, and access. Traders and small business operators in cities such as Lagos, Abuja, Kano, and Calabar have since praised the apex bank for what they described as lasting solutions to a long-standing problem, saying improved access has allowed smoother transactions and better planning.

Visits to several commercial bank branches during the festive season confirmed these accounts. Customers were largely able to obtain cash over the counter without prolonged delays, while many banks ensured their ATMs were adequately funded, providing alternative withdrawal options.

In banking districts such as Ibeju-Lekki, Victoria Island, and Ikoyi in Lagos, the long queues that usually define the season were noticeably absent. Customers moved through banking halls more quickly, a development widely attributed to better cash availability and improved branch management.

Mrs. Nkiru Onyema, a bank customer, described her experience as a sharp contrast to previous years. She said she spent about 10 minutes withdrawing N20,000 over the counter at her bank. “I am happy that the old practice of people queuing endlessly in banks and ATMs is over,” she said.

Another customer, Stephen Abiodun, said he was able to withdraw cash from his bank’s ATM within minutes. “After spending about 15 minutes, I got cash easily. Time spent in banking halls has reduced, giving people more time for productive activities,” he said.

Similar observations were recorded at branches in Garki, Abuja; Broad Street, Lagos; and the Ikeja axis, where ATMs were functional and dispensing cash consistently, contributing to a calmer banking environment.

The President of the Bank Customers Association of Nigeria, Dr. Uju Ogubunka, said the development brought significant relief to customers nationwide. He noted that sustaining the progress would depend largely on banks proactively requesting adequate cash from the CBN, especially during peak demand periods.

Explaining how the improvements were achieved, Governor Cardoso said the apex bank undertook a comprehensive end-to-end review of the cash lifecycle. Speaking at the Chartered Institute of Bankers of Nigeria’s bankers’ dinner in Lagos, he said the review covered cash production, transportation, distribution, and access by consumers.

“This holistic assessment allowed us to address root causes rather than symptoms,” Cardoso said. He added that the CBN recalibrated cash-printing models, issued guidelines on optimal ATM-to-card ratios, tightened approval requirements for ATM or branch closures, enforced sanctions on banks with non-dispensing ATMs, and intensified supervision of payment agents and PoS operators.

Digital finance momentum

Beyond cash management, Nigeria’s digital finance transformation gathered further pace in 2025, reflecting the CBN’s dual focus on innovation and system stability. The apex bank extended its Payment System Vision roadmap to 2028, reinforcing plans to modernise infrastructure and strengthen cybersecurity.

According to the CBN, over 12 million contactless payment cards are now in circulation, while the regulatory sandbox has expanded to host more than 40 fintech innovators. Revised agent-banking guidelines have strengthened anti-money-laundering controls, including geo-fencing of high-risk areas, and improved consumer protection. Enhanced integration among switching companies has also advanced domestic interoperability.

Backed by these measures, Nigeria is increasingly regarded as one of Africa’s most advanced digital payments markets. The country’s fintech ecosystem accounts for eight of the continent’s nine unicorns, with leading apps surpassing 10 million downloads by mid-2025, and one exceeding 50 million.

Foreign card usage

In a move to further enhance access and convenience, the CBN recently directed banks and financial institutions to ensure uninterrupted use of foreign-issued payment cards across ATMs, PoS terminals, and online platforms nationwide.

The directive, issued by the Financial Policy and Regulation Department and signed by its Director, Rita Sike, is aimed at improving access to funds, security, and user experience for tourists and Nigerians returning from the diaspora. Institutions were instructed to configure systems to accept international cards, comply with card-scheme standards, and maintain high system availability.

The circular also introduced multi-factor authentication for higher-value transactions, mandated clear disclosure of exchange rates and charges, and strengthened know-your-customer and anti-money-laundering controls. Banks were warned that unresolved customer complaints escalated to the regulator would attract sanctions.

Enforcement actions

To reinforce compliance, the CBN sanctioned Deposit Money Banks that failed to ensure cash availability through ATMs during the festive season, imposing fines of N150 million on defaulting institutions following spot checks.

Confirming the action, the Acting Director of Corporate Communications, Hakama Sidi Ali, said seamless cash circulation was critical to public confidence and economic stability, adding that further violations would attract additional sanctions.

The apex bank said investigations into cash hoarding and rationing by banks and PoS operators would continue, in collaboration with security agencies, to curb illegal cash sales and enforce withdrawal limits.

Governor Cardoso reiterated that banks must strictly comply with cash distribution policies or face stiff penalties, stressing the CBN’s commitment to maintaining adequate cash buffers.

“Our focus remains on fostering trust, ensuring stability, and guaranteeing seamless cash circulation across the financial system,” he said.