As of November 2021, N496.17 trillion was given out as domestic credit after necessary deductions in Nigeria. Data shows that the net domestic credit given out increased steadily over the months.
The net domestic credit is a sum of net claims on the central government and claims on other sectors of the domestic economy. This is the sum of net credit to the non-financial public sector, credit to the private sector, and other accounts. This credit provides capital for private businesses and government operations generated domestically within the economy.
In aggregate, January recorded the least volume of credit given out (N42.95 trillion). After that, the net domestic claims continued to rise, reaching N48.3 trillion in November 2021.
Of this figure, N136.75 trillion was given to the government, while N359.42 trillion was private sector credit.
#ChartoftheDay: N31.29 Trillion Passed Through the Bank in 2021
The banking system disbursed the sum of N31.29 trillion from January to November 2021. This figure represents the amount released by the banks into circulation in Nigeria within the period.
Thus, the economy was liquefied in that sum in the first eleven months of 2021. Currency in circulation represents cash in paper notes and coins used to conduct transactions in an economy. This is part of the overall money supply in the economy.
Data shows that the amount of money in circulation was the least in June, where N2.74 trillion was circulated, and the highest was in November, with N3.15 trillion circulated.
The total money in circulation is determined by some factors. These include the interest rates at which money is borrowed, the inflation rate in the economy, the level of economic growth, and the current account balance of individuals.
#ChartoftheDay: Banks had an Average Monthly Reserve of N10.21 Trillion in 2021
The average monthly reserve held by banks in Nigeria summed up to N10.21 trillion as of November 2021. The total reserve for the eleven months was N112.27 trillion.
Data shows that the bank reserve held by banks had a differential of N1.02 trillion between the least and the highest. In June, which was the least, N9.95 trillion was the total aggregate reserve by banks. February recorded the highest where a total of N10.62 trillion was held as a reserve.
Bank reserves are contingency funds that provide funds for banking emergencies. It is an obligation imposed on banks to hold a certain amount of cash as a reserve, so they never run out of money to meet customers’ demands. Furthermore, the bank reserve level is a monitory policy tool controlled by the central bank.
#ChartoftheDay: N26.17 Trillion was Unbanked in 2021
N26.17 was the total figure of unbanked money in Nigeria from January to November 2021. This figure was the amount of money circulating in the Nigerian economy for which the banking system did not account.
Data shows that the banking system issued not all the money used for transactions in 2021. A total of N26.17 trillion was used to carry out various transactions in Nigeria in 2021, which the bank did not issue.
In January, N2.36 trillion was the total unbanked money used in transactions. The figure dropped steadily till April, then increased in May and decreased in June to N2.25 trillion, which was the least for the period. It rose steadily from August to November, where it recorded the highest figure of N2.72 trillion.
The level of poverty in an economy is one of the factors that accounts for unbanked money in circulation. This is so due to the cost of operating a bank account associated with the various charges deducted for services rendered. Thus, the poor cant afford to pay such extra charges on their already lean funds.