Currency outside banks drops to N4.8 trillion in July, lowest in eight months

Currency held outside Nigerian banks fell to N4.8 trillion in July 2026, its lowest level since November 2025, as the amount of cash circulating outside the banking system declined for the second consecutive month.

This is according to the latest data from the Central Bank of Nigeria (CBN).

The figure dropped by N118.7 billion, or 2.4%, from N4.92 trillion recorded in June, extending the decline from the N5.19 trillion reported in May.

The latest decline also brought currency outside banks further below the N5 trillion mark, reversing part of the increase recorded during the first half of the year.

What the data is saying

CBN data tracked by Nairametrics showed that currency outside banks stood at N5.25 trillion in January 2026 before falling to N5.19 trillion in February, N5.08 trillion in April, and N5.19 trillion in May. It then declined to N4.92 trillion in June and N4.8 trillion in July.

• On a year-to-date basis, currency outside banks has fallen by N450.2 billion, or 8.6%, from N5.25 trillion in January to N4.8 trillion in July.
• The decline in July coincided with a fall in total currency in circulation. Currency in circulation dropped from N5.52 trillion in June to N5.38 trillion in July, representing a monthly decline of N140.6 billion, or 2.5%.
• The figures indicate that less cash was being held outside the banking system during the month, although currency outside banks still accounted for the vast majority of currency in circulation.

The decline in currency outside banks came alongside a substantial increase in bank reserves.

CBN data showed that bank reserves rose from N34 trillion in June to N36.73 trillion in July, an increase of about N2.73 trillion, or 8.0%.

• Special intervention reserves remained unchanged at N329.4 billion during the period.
• The combination of rising bank reserves and falling currency outside banks points to a shift in the composition of monetary liquidity, with more funds held within the banking system relative to cash held outside banks.
• The movement is also notable against the trend recorded at the end of 2025. Currency outside banks increased to N5.41 trillion in December 2025, before declining during the first two months of 2026.

Despite the recent decline, currency outside banks remains above the levels recorded during much of 2025.

The figure stood at N4.45 trillion in August 2025, N4.47 trillion in September and N4.65 trillion in October before rising to N4.91 trillion in November and N5.41 trillion in December.

Get up to speed

The decline in cash outside banks could reflect increased use of electronic payment channels, greater movement of funds through bank accounts and changes in cash demand across the economy.

• At the launch of the Nigeria Payment System Vision (PSV) 2028 in Abuja, CBN Governor Olayemi Cardoso said the new vision builds on Nigeria’s progress in digital payments and seeks to accelerate the country’s transition towards a more inclusive and technology-driven financial ecosystem.

The apex bank aims to reduce cash circulating outside the banking system to below 40% of total currency in circulation.

The bank also noted that it was expanding financial inclusion to 95% of the adult population by 2028.

What you should know

Nigeria has emerged as one of Africa’s leading digital payments markets over the past decade, driven by rapid growth in fintech, mobile money, instant payments, and digital banking services.

• In May 2025, CBN, in collaboration with the Nigeria Inter-Bank Settlement System (NIBSS), officially launched the Non-Resident Bank Verification Number (NRBVN) platform.

The platform aims to simplify the process for Nigerians living abroad to obtain their Bank Verification Number (BVN) remotely, removing the need for in-person verification in Nigeria.