E-Financial
CBN Battles to Limit Cash-Crunch Fallout
By Shehu Salmanu
As Nigeria’s Central Bank tries to rebuild trust following a disastrous introduction of new naira bills, customers’ faith in the financial system is being tested, as many still battle to obtain cash.
Nigeria’s Central Bank (CBN) has doubled supply of banknotes to commercial banks for circulation among customers.
The country’s apex money authority has also directed all commercial banks to load their ATMs and conduct physical operations over weekends to ease the monthslong cash crunch that plunged Africa’s largest economy into financial disarray.
It also ordered the old naira bills to be circulated until the end of this year.
Nigeria has battled a cash crunch since October 2022, when the CBN gave a February 2023 deadline to
The new change old 200, 500, and 1,000 naira bills for newly redesigned ones.
Customers still can’t get cash
The new notes were introduced to mop up excess cash outside the banking system, counter corruption and discourage ransom payments to bandits and kidnappers.
Stories of long lines and frustrated customers sleeping outside banks to get cash have been widely documented in Nigeria.
Yet, despite the CBN’s efforts, it appears that some Nigerians are shunning the banking sector, saying the poorly-implemented naira redesign policy has exposed the system’s inefficiency.
Last week, the country’s National Labour Congress (NLC) union threatened strikes over the cash scarcity.
The strike was postponed for two weeks, with NLC president Joe Ajaero saying the organization would monitor how Nigerians were accessing cash.
But many customers, like Samson Adebo, say the situation has not eased.
“There are a lot of crowds because people have been struggling to get cash,” he told DW near a bank in northern Nigeria.
“In fact, I came here several times, and I couldn’t get what I wanted. I think that if you went to any bank in Nigeria, there would be crowd despite the fact they said there is cash.”
Counting the cost
Financial analysts believe the crisis has cost Africa’s largest economy about 20 trillion naira (around Ꞓ40 billion).
It also inadvertently increased the banking sector’s risk of collapse as customers are now shunning cash deposits. The CBN has urged customers to be patient.
While commercial banks have been directed to load their ATMs with new bills, not all are complying, according to some customers DW spoke to.
“Even though there is court ruling on the usage of old naira notes, people should not expect normal business as it was before because the policy didn’t support so much cash in circulation,” Kaduna-based economic analyst Fatimah Salihu Abubakar told DW.
“Government has now realized that 75% of the businesses in Nigeria are dominated by small and medium scale businesses and they heavily rely on cash transactions,” Abubakar added.
“Its advice has been that these enterprises should start accepting the other available channels of payment such as mobile banking, the internet banking, and use of the USSD.”
Central Bank fights to retain faith
According to Fatimah Salihu Abubakar, the Nigeria’s Central Bank should take responsibility for its poorly implemented currency shift, which has hit the informal sector particularly hard.
“At first when the CBN gave out the deadline for old naira notes, people believed it was impossible and didn’t take serious action. Most of people in rural areas found it difficult to transact, and gave rise to a lot of complaints that made the Supreme Court intervene with the extension. People are a bit more relaxed but to the policy is not healthy,” she told DW,
The policy shift was initially intended to promote cashless transactions in Nigeria, where businesses operating in the informal sector, which relies heavily on cash, hardly use the banking system. The CBN also said the new policy would help remove excess cash outside the banking system, counter corruption and discourage ransom payments to bandits.
This article has been adapted from a radio report which was originally broadcast on DW’s daily radio show, AfricaLink.
Debt Management Office (DMO) said the federal government spent N3.14 trillion on servicing its domestic debt in the first quarter of 2026.
The office disclosed the data in its latest domestic debt service report for Q1 2026.
The figure comprises N2.97 trillion in interest payments and N169.68 billion in principal repayments.
The agency said in January, the government spent N741.82 billion on domestic debt service, while the figure rose to N967.67 billion in February.
Debt service increased further to N1.43 trillion in March, bringing the total for the quarter to N3.14 trillion.
The March figure was 47.7 percent higher than the N967.67 billion recorded in February and 92.7 percent above the N741.82 billion spent in January.
Also, the debt office said interest payments accounted for about 94.6 percent of total domestic debt service during the quarter.
The DMO said treasury bills accounted for the largest share of interest payments at N1 trillion, while interest on federal government bonds stood at N1.96 trillion.
The agency said the government also paid N4.24 billion in interest on FGN savings bonds during the period.
The DMO said the principal component of the debt service comprised N169.68 billion in repayments on local-denominated promissory notes.
Overall, the government’s domestic debt service rose sharply through the quarter, with March accounting for almost half of the N3.14 trillion spent between January and March.
Nigeria’s public debt increased by 0.01 percent to N159.35 trillion in the Q1 of 2026.
Interswitch Group, an integrated digital payments and commerce company, together with global banking software provider, Temenos have reassured the Central Bank of Nigeria (CBN) of their commitment to advancing the modernisation of Nigeria’s financial services sector.
Interswitch and Temenos had earlier in June announced a strategic partnership across Africa which would see Interswitch leverage Temenos solutions – across core banking, digital banking, payments, wealth management and financial crime mitigation – to provide cloud-hosted and on-premises managed services to banks and financial institutions across Africa.
This will enable institutions to progressively transform their banking platform and evolve to more customer-centric business models. The service will initially support key African markets including Nigeria, Ghana, Côte d’Ivoire, Kenya and others.
The recent regulatory visit to CBN headquarters in Abuja, was led by the Founder and Group Chief Executive Officer of Interswitch, Mitchell Elegbe, and Managing Director for the Middle East and Africa (MEA) at Temenos, Santhosh Rao, as part of the ongoing efforts by both organisations to deepen collaboration with Central Banks across the African region on the future of digital banking infrastructure across Nigeria and key African markets.
Discussions centred on the strategic partnership between Interswitch and Temenos, and how it will enable Nigerian financial institutions to progressively modernise their core banking platforms and transition to more customer-centric business models.
The two organisations also explored opportunities to work with the CBN in charting new frontiers in Central Bank Digital Currency (CBDC) innovation, leveraging resilient financial networks and decentralised application platforms to support the issuance and management of CBDCs.
Commenting on the visit, Elegbesaid: “Our partnership as Interswitch with Temenos and our continued engagement with the Central Bank of Nigeria reflect a shared commitment to building banking infrastructure that is resilient, inclusive, and ready for the next phase of Africa’s financial evolution.
We are proud to be at the table as these conversations shape the future of digital banking technology and innovation across key Africa markets…”
The Bank of Industry, through BOI Financing SPV Plc, has opened subscriptions for its inaugural Series 1 Fixed Rate Bond worth up to N250bn under its $1bn multi-currency instruments programme, seeking to raise long-term capital to finance businesses across Nigeria’s priority sectors.
The offer, which opened on 5 August and closes on 11 August, is being arranged by Chapel Hill Denham as the lead issuing house. The five-year bond is priced within a yield range of 17.35 per cent to 17.50 per cent and will be listed on the FMDQ Securities Exchange.
According to the offer document, proceeds from the issuance will be deployed to finance eligible businesses and projects across sectors, including agriculture and food processing, healthcare, engineering and technology, renewable energy, petrochemicals, oil and gas, creative industries and solid minerals, in line with BOI’s development finance mandate.
The lender said the financing is expected to improve access to medium and long-term funding for Nigerian enterprises, expand productive capacity, create and preserve jobs, deepen local value addition, support import substitution, boost exports and strengthen domestic value chains.
BOI, Nigeria’s foremost development finance institution, said it has provided funding to more than one million businesses across the country and disbursed over N1.27tn between 2023 and 2025. The institution operates across 34 states and the Federal Capital Territory and is jointly owned by the Ministry of Finance Incorporated and the Central Bank of Nigeria.
The bank also highlighted its financial performance, reporting a 36 per cent compound annual growth rate in gross earnings between 2021 and 2025.
Interest income rose 64 per cent to N884bn in 2025 from N538bn in the previous year, while its capital adequacy ratio stood at 39 per cent, nearly four times the regulatory minimum of 10 per cent. Its non-performing loan ratio was 1.7 per cent, below the CBN’s prudential limit of five per cent.
The bond has been assigned AAA ratings by Agusto & Co. and Intelligence Africa, reflecting the issuer’s strong capitalization, profitability, liquidity and ownership structure.
The issuance is open to institutional and qualified investors with a minimum subscription of N5m and additional investments in multiples of N1m. Interest will be paid semi-annually at a fixed rate, while principal repayment will begin in the third year through equal semi-annual amortised instalments until maturity in 2031.
The bond is also exempt from tax, making it an attractive investment option for investors seeking stable returns amid expectations of declining interest rates.
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