Nigeria’s currency outside banks fell by 3.66% to ₦5.21 trillion in January 2026, reflecting a post-festive moderation in cash demand, CBN reports

Currency outside the banking system and total currency in circulation in Nigeria recorded slight declines in January 2026, reflecting a moderation in cash demand after the typical surge associated with year-end spending.

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According to the latest money and credit statistics released by the Central Bank of Nigeria (CBN), currency outside banks fell by 3.66% to ₦5.21 trillion in January 2026, down from ₦5.41 trillion in December 2025.

Similarly, total currency in circulation marginally declined by 0.03% to ₦5.73 trillion, compared with ₦5.73 trillion in December, signaling broadly stable liquidity conditions in the economy.

The figures indicate that cash held outside the banking system continues to dominate Nigeria’s monetary landscape, highlighting the country’s continued reliance on physical cash for transactions, especially within the informal sector.

“The decline in January follows the seasonal pattern in which currency demand rises sharply during the festive period and eases at the start of a new year as households and businesses return excess cash to banks,” the CBN noted.

A review of currency trends over the past year shows fluctuations but generally elevated cash holdings outside the banking system.

For instance, currency outside banks rose sharply in December 2025 to ₦5.41 trillion from ₦4.91 trillion in November, reflecting year-end liquidity build-up driven by festive spending and increased retail transactions.

Throughout 2025, currency outside banks ranged between ₦4.42 trillion and ₦4.74 trillion, reflecting intermittent adjustments in cash demand amid evolving economic conditions.

The seasonal pattern observed mirrors trends at the end of 2024, when year-end spending pushed cash outside banks from ₦4.65 trillion in November to ₦5.13 trillion in December.

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Overall, the modest declines in January 2026 suggest a post-festive normalization in cash demand, while the dominance of cash outside banks underscores Nigeria’s continued dependence on physical currency for daily transactions.