The Bank of Ghana (BoG) significantly reduced its currency issuance expenses to GH¢471 million in 2025, a sharp decrease from over GH¢1 billion in the previous year, even as the total amount of cash in circulation climbed to GH¢83.8 billion. This financial report, detailed in the BoG’s 2025 Financials, highlights a substantial efficiency gain in the central bank’s operational costs related to managing the nation’s currency.
Context of Currency Management
Currency in circulation encompasses all banknotes and coins held by the public and financial institutions, valued at their face amount. The Bank of Ghana’s liability for these issued notes and coins is calculated after accounting for any currency held internally by the bank itself. Managing the volume and cost of currency issuance is a critical function for any central bank, impacting monetary policy, inflation, and public confidence in the financial system.
Detailed Breakdown of Costs
The primary driver of the reduced issuance cost was a dramatic drop in the expenses related to printing new banknotes and minting coins. These costs fell from GH¢986 million in 2024 to GH¢277 million in 2025. This indicates a successful renegotiation of contracts, improved production efficiencies, or a reduced need for extensive new currency printing compared to the prior year.
Conversely, agency fees saw a slight increase, rising to GH¢10.6 million. Other currency-related expenses experienced a substantial surge, escalating from GH¢14.6 million in 2024 to GH¢183 million in 2025. This significant jump in ‘other expenses’ warrants closer examination, as it partially offsets the savings achieved in printing and minting.
Expenses associated with the importation of foreign currency also saw a modest rise, from GH¢14.4 million in 2024 to GH¢16.5 million in 2025. This suggests ongoing needs for foreign exchange reserves or specific foreign currency instruments managed by the central bank.
Rising Cash in Circulation
Despite the reduction in issuance costs, the total value of currency in circulation experienced a marginal increase. It grew from GH¢71.6 billion in 2024 to GH¢83.8 billion in 2025. This trend indicates a persistent demand for physical cash among the Ghanaian populace and businesses, potentially driven by various economic activities, including informal transactions and savings preferences.
Expert Perspectives and Data
Central banks globally face the challenge of balancing the cost of producing and distributing currency with the public’s demand for it. “Efficient currency management is key to maintaining the integrity of a nation’s money supply,” notes Dr. Kwabena Duffour, a former Governor of the Bank of Ghana. “When issuance costs are high, it can put pressure on the central bank’s budget and indirectly affect monetary policy decisions.” The significant reduction in printing costs, as reported by the BoG, suggests a positive development in operational efficiency. However, the sharp rise in ‘other currency expenses’ could be a point of concern for fiscal discipline.
Data from the BoG’s 2025 Financials reveals that the cost of issuing GH¢1 of currency has decreased substantially. This efficiency gain is crucial for the central bank’s financial health and its ability to allocate resources to other vital economic functions.
Implications for the Economy and Public
The reduction in currency issuance costs is a positive indicator for the Bank of Ghana’s financial management. It suggests that the central bank is becoming more efficient in its operations, potentially freeing up resources that can be channeled into other areas of economic development or stability.
The continued rise in cash in circulation, however, implies that physical currency remains a dominant medium of exchange in Ghana. This has implications for digital payment initiatives, financial inclusion strategies, and the tracking of economic activity. While digital transactions are growing, the demand for cash suggests that traditional banking and payment methods are still deeply entrenched.
Looking Ahead
What remains to be seen is the sustainability of these reduced costs, particularly in light of the significant increase in ‘other currency expenses’. Further transparency from the Bank of Ghana regarding the composition of these ‘other expenses’ would be beneficial for stakeholders. Additionally, monitoring the trend of cash in circulation against the backdrop of increasing digital payment adoption will be crucial in understanding the evolving landscape of financial transactions in Ghana.
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