Nigeria is arguably Africa’s biggest country by population and GDP. With a population of about 213 million according to the US Census Bureau and a GDP of $600 billion, it warehouses 20% of the continents population, producing 15% of Africa’s GDP with the potential to improve or worsen the overall outlook of the continent depending on the country situation.

The Central bank of Nigeria reported in 2022 that the financial inclusion rate in country was 64%, meaning 34% of the adult population were excluded from the formal financial sector, and had planned increasing the population captured by the sector to 95% by 2024 through its revised national financial inclusion strategy (NFIS 3.0) launched 2022.

Other CBN initiatives intended to ensure 95 per cent of Nigerians have access to financial services included the National Strategy for Leveraging Agent Networks for Women’s Financial Inclusion; National Fintech Strategy; Nigeria Payments System Vision 2025 (PSV 2025); Nigerian Financial Services Maps (NFSMaps); the CBN Regulatory Sandbox as well as the Central Bank of Nigeria – Central Bank of Egypt Fintech Bridge.

In 2022, the country’s apex bank launched a currency redesign policy. According to the CBN, the objectives of the policy included the following:

• Reduce the volume of money in circulation outside the banking system
• To increase the supply of clean notes
• To make monetary policy more efficacious
• To limit naira counterfeiting
• To deepen the cashless policy
• To support security forces in fighting terrorism and ransom taking

Contrary to the expectations of the country’s apex bank, the recent cash crisis from its rancorous implementation of the redesign policy may work at cross purposes with its financial inclusion target; further alienating people from the formal financial services sector.

Out of approximately 250 respondents spread across Lagos, Abuja, Bauchi, Edo, Ogun and Ontario Canada aged 38 years and older, 73.3% were male and 26.7% female. All respondents reported having bank accounts in Nigeria.

Although most respondents (67%) agree that the apex banks currency redesign policy was necessary, 73.4% rank the quality of its implementation below 5 on a scale of 0 – 10 and from poor to exceptional.

As at March 2023, the confidence level in Nigeria’s financial services sector dipped by 13.3% because of CBNs poor handling of the currency redesign policy.

While all respondents plan to continue operating their local bank accounts, 13.3% plan to take their money outside the formal financial services sector while 26.7% reported they are uncertain about where to keep their money. When asked about other Nigerians, 53.6% reported that between 10 and 50 percent of other Nigerians may be inclined to move their funds to the informal sector.