The Monetary Policy Committee (MPC) of the Central Bank of Nigeria (CBN) has opted to retain the Monetary Policy Rate (MPR) at 27.5%, despite widespread expectations that it would cut interest rates following a significant drop in Nigeria’s inflation rate.

CBN Governor Olayemi Cardoso announced the decision on Thursday at a press conference in Abuja, following the committee’s 299th meeting. The decision to maintain the current rate comes after months of aggressive monetary tightening by the CBN, which has raised the MPR 15 times since May 2022 in a bid to combat surging inflation.

However, with the National Bureau of Statistics (NBS) reporting a sharp drop in inflation from 34.8% to 24.48% in January due to a rebasing of the Consumer Price Index (CPI), many analysts expected the MPC to ease monetary policy. The committee’s decision to hold the rate has cast further doubt on the credibility of the NBS’ inflation recalibration, which many argued misrepresents Nigeria’s economic reality.

The NBS’ revision of Nigeria’s CPI methodology significantly altered inflation calculations. The new methodology adjusted the weight of various components in the consumer basket to better reflect current spending patterns, leading to a drastic decline in reported inflation.

Cardoso acknowledged the revised CPI calculations but noted that committee members were still concerned about persistent inflationary pressures, particularly in food prices.

“Members, however, were not oblivious to the risk of persisting inflationary pressures driven largely by food prices,” Cardoso stated.

The controversy surrounding the NBS figures has been fueled by widespread complaints from Nigerians, who lament that prices of essential goods and services remain alarmingly high despite the reported drop in inflation. Many economic observers believe that the CPI rebasing does not reflect actual market conditions, and the MPC’s refusal to lower interest rates is believed to have reinforced doubts over the accuracy of the NBS’ inflation report.

Foreign Exchange Stability and Fiscal-Monetary Coordination

Beyond inflation, the CBN also factored in foreign exchange market stability in its decision to hold rates. Cardoso highlighted that the appreciation of the naira and the gradual convergence of exchange rates between the official and parallel markets were key factors in the committee’s deliberations.

“The committee highlighted the benefits of the improvements in the external sector to exchange rate stability, including the convergence of rates between the Nigeria foreign exchange market and the bureau de change,” he said.

This comes as the CBN continues to implement measures aimed at boosting liquidity in the FX market, with policies designed to tighten control over currency speculation and improve dollar inflows.

Additionally, the MPC stressed the importance of fiscal-monetary coordination, calling for stronger collaboration between the CBN and the federal government to achieve price stability and sustained economic growth. With Nigeria facing external shocks, volatile oil revenues, and a decline in foreign investment, such coordination is seen as crucial for long-term economic stability.

Other Key Policy Decisions: CRR and Liquidity Ratio Maintained

In addition to holding the MPR at 27.5%, the committee also kept the Cash Reserve Ratio (CRR) at 50% and the liquidity ratio at 30%. These measures aim to ensure stability in the banking system while controlling inflationary pressures.

Furthermore, the CBN reiterated its commitment to deepening financial inclusion, managing inflation expectations, and improving the monetary policy transmission mechanism.

“The committee also urged the bank (CBN) not to relent in its efforts to boost market liquidity,” Cardoso stated.

Is the NBS’ Inflation Report Credible?

With the MPC deciding to hold rates despite the inflation decline, the question remains: Does the NBS’ rebasing truly reflect Nigeria’s economic reality?

Public perception suggests otherwise as rising food and energy costs remain high, contradicting the official inflation figures. Against this backdrop, the business community remains skeptical, with concerns that the revised CPI paints an overly optimistic picture of Nigeria’s inflationary environment.

Analysts believe that investors may take caution as conflicting signals from the CBN and NBS raise questions about policy transparency and data reliability.

A recent survey reveals a significant surge in mobile financial services adoption across Africa. Nearly half of the respondents (49%) use both mobile payments and mobile banking, while 36% rely solely on mobile banking, and 10% use only mobile payments.

Only 5% of respondents reported not using any mobile financial service.

Growing Mobile Finance Adoption in Africa

Across Africa, mobile finance is revolutionizing how people access and manage money. With traditional banking infrastructure limited in many regions, mobile financial solutions have emerged as a game-changer, bridging gaps in financial inclusion, and empowering millions.

Mobile money services, led by platforms like M-Pesa, Airtel Money, and MTN MoMo, have experienced explosive growth. From enabling peer-to-peer transactions to facilitating bill payments and cross-border remittances, these services have become a financial lifeline for individuals and businesses.

According to industry reports, Africa accounts for nearly 70% of the world’s mobile money transactions, highlighting the continent’s leadership in digital financial innovation. The use of mobile financial services has seen a remarkable increase, rising from 63% in 2023 to 85% in 2024. Currently, 95% of respondents use either mobile banking, mobile payments, or both.

Kenya leads in mobile payment adoption, with 28% of respondents actively using mobile payment apps far above the continental average of 10%. South Africa and Morocco report higher-than-average mobile banking usage, with 50% and 52% adoption rates, respectively, compared to the continental average of 36%.

The Security Challenge of Mobile Transactions

Despite its rapid growth, mobile finance in Africa faces challenges such as cybersecurity threats, regulatory complexities, and digital literacy gaps. The Communications Authority of Kenya (CA) reported a 333% surge in mobile application threats between July and September 2024, with cybercriminals targeting user data, including login credentials and financial details.

However, these hurdles present opportunities for further innovation. Strengthening digital infrastructure, improving financial education, and enhancing cybersecurity measures will be crucial in sustaining the momentum of mobile finance adoption.

Looking more broadly, the continued rise in mobile data usage underscores Africa’s mobile-first approach to internet connectivity. This trend has significant implications for cybersecurity.

Increased digital financial inclusion: The rise in mobile banking and payments indicates greater financial inclusion through digital means, which is generally positive for economic development in Africa.

Increased attack surface: Firstly, more mobile usage and mobile financial services users mean a larger attack surface for cybercriminals. Users are generally less vigilant on their smartphones and tablets compared to traditional computers, making them more susceptible to malicious attacks.  Secondly, with more people conducting financial transactions on potentially unsecured and secondhand devices, the risk and impact of cybercrime have increased.

The growing trend of unlocked cellphone theft in the region highlights this issue. In South Africa, an average of 189 cell phones are stolen daily, with women being predominantly targeted. Stolen devices, particularly when unlocked at the time of theft, grant criminals’ access to sensitive data including banking apps and personal information.

Blurred lines between personal and professional: The increase in WhatsApp usage for work (from 89% in 2023 to 93% in 2025) shows a further blurring of lines, between users’ personal and professional lives. This can lead to increased risks, as personal devices may not have the same level of security as corporate-managed devices.

Need for mobile-centric security education: The survey results suggest a pressing need for cybersecurity education that focuses specifically on mobile security and best practices for using personal devices for work-related tasks. There’s also a clear need for cybersecurity education specifically tailored to mobile financial services, focusing on secure transaction practices and recognizing financial fraud attempts.

The Future of Mobile Finance in Africa

As mobile transaction continues to gain traction, its impact will extend beyond payments and banking. Sectors like agriculture, healthcare, and education are increasingly integrating mobile financial solutions to streamline operations and improve service delivery.

With advancements in blockchain, artificial intelligence, and open banking, the next phase of mobile finance in Africa promises to be even more transformative, driving economic inclusion and financial empowerment across the continent.