Dr. Olayemi Cardoso, the Governor of the Central Bank of Nigeria (CBN), has vowed to address the growing issue of the commoditization of the Naira, which refers to the practice of treating the national currency as a tradable asset rather than its intended purpose as a medium of exchange. This issue has become a significant challenge for Nigeria’s financial ecosystem and affects not only the banking sector but also the daily lives of Nigerians who depend on the Naira for transactions.
During the inaugural Stakeholders’ Conference of the Committee of Heads of Banks Operations (CHBO) in Lagos, Cardoso, represented by Fatai Kareem, the Senior Special Adviser to the CBN Governor, emphasized that the Naira’s stability is crucial for Nigeria’s economic growth and development. The trend of commoditizing the Naira has undermined its national value, with individuals treating it as a tradable asset in the market, thereby distorting its primary function.
To combat this, the CBN plans to implement several strategies, including:
- Public Engagement and Awareness: Enhancing public education on the responsible use of the Naira.
- Strengthening Cash Management: Ensuring a fair distribution of Naira across the country.
- Collaboration with Law Enforcement: Working with law enforcement agencies to enforce existing regulations and prosecute offenders.
- Promoting Digital Payments: Encouraging digital payment methods to reduce reliance on cash transactions, thus curbing the commoditization of physical currency.
Abraham Aziegbe, the Chairman of the CHBO Executive Committee, linked the rise in Naira commoditization to a severe cash scarcity that had plagued the country over the past two years. This scarcity has led to a situation where Nigerians pay premiums for everyday transactions, reflecting the challenges faced in accessing cash and concerns over hoarding practices by banks.
