Currency in circulation refers to the amount of cash–in the form of paper notes or coin within a country; that is physically use to conduct transactions between consumers and businesses. It is all of the money that issued by a country’s monetary authority; minus cash that has been removed from the system.
According to the CBN, it used the “accounting/statistical/withdrawals and deposits technique”; to determine how much money was in circulation in Nigeria.
Recently, the CBN issued a directive to deposit revenue advising them not to take maimed naira notes as they were not the actual currency in use. It further stated that every constructed notes found in the DMbs deposit would result in a 400% fine of its worth.
This strategy entails monitoring the changes in the amount of money in circulation transaction by transaction.