Nigeria’s Currency Outside Banks Falls to N4.49trn in June, Still 90% of Cash in Circulation
Currency outside Nigeria’s formal banking sector dropped slightly to N4.49 trillion in June 2025, compared to N4.63 trillion in May, according to the latest data from the Central Bank of Nigeria (CBN). Despite the moderation, cash outside banks continued to dominate overall liquidity, accounting for nearly 90 per cent of the country’s total currency in circulation (CIC).
The CBN report showed that total CIC closed June at N5.01 trillion, marginally above the N5.00 trillion recorded in May. This marks the first easing of cash held outside banks in two months, after a steady increase earlier in the year. Analysts say the shift underscores ongoing adjustments in liquidity conditions following a year of elevated cash withdrawals.
Over the past year, out-of-bank currency has seen significant growth, rising from N3.79 trillion in June 2024 to a peak of N5.13 trillion in December 2024, largely driven by festive season spending. Between July and November 2024, CoB expanded consistently—from N3.66 trillion in July to N4.65 trillion in November—highlighting Nigerians’ persistent reliance on cash transactions despite digital banking initiatives.
The trend began to shift in early 2025. Currency outside banks declined to N4.74 trillion in January, dropped further to N4.52 trillion in February, and steadied at N4.57 trillion in April before rising slightly to N4.63 trillion in May. The June moderation, though small, still represents an 18.6 per cent year-on-year increase, raising concerns about unbanked liquidity and its impact on the CBN’s monetary policy effectiveness.
Year-on-year comparisons reveal that total currency in circulation rose by 24 per cent in June 2025 compared to the same month in 2024, when CIC stood at N4.05 trillion. During that period, more than 93 per cent of currency was held outside banks, peaking at N5.13 trillion in December 2024. The data reflects a persistent challenge for policymakers seeking to deepen financial inclusion and reduce Nigeria’s heavy reliance on cash.
Source: this day