Digital Financial Innovation, Currency Outside Banking System, and Inflationary Rate in Nigeria: Implications for Exchange Rate Management

Authors

• Philip Ifeakachukwu Nwosa PIN, Federal University Oye-EkitiFollow

Keywords

e-payments, automated teller machine, web pay, mobile money, exchange rate

Abstract

Digital financial innovation has expanded globally, supporting cashless systems and reducing currency outside banks and inflation in advanced economies. In Nigeria, however, rising use of digital payment platforms has coincided with increasing inflation and higher cash in circulation. This study explores the relationship among digital financial innovation, currency outside the banking system, and inflation from 2009 to 2024, while assessing implications for exchange rate management. Findings show that despite rapid digital payment growth, both inflation and cash outside banks remain elevated, creating challenges for effective exchange rate stability. The study adopts a descriptive research design to examine the relationship among digital financial innovations, currency outside the banking system, and the inflation rate in Nigeria. 

Author Bio

Nwosa Philip Ifeakachuwu is a Professor of Economics at the Department of Economics, Faculty of Social Sciences, Federal University Oye-Ekiti, Nigeria. His areas of research include International Economics, Macroeconomics and Contemporary Economic Issues.

Publication Title

Bullion

Issue

1

Volume

50

First Page

31

Last Page

35

Recommended Citation

Nwosa, Philip Ifeakachukwu PIN (2026) "Digital Financial Innovation, Currency Outside Banking System, and Inflationary Rate in Nigeria: Implications for Exchange Rate Management," Bullion: Vol. 50: No. 1, Article 1.
DOI: https://doi.org/10.33429/0331-7919.1633
Available at: https://dc.cbn.gov.ng/bullion/vol50/iss1/1