The amount of cash held outside Nigeria’s banking system rose to ₦4.923 trillion in September 2026, more than doubling its September 2023 level, despite the growing use of electronic payment channels. Demand deposits also increased to ₦39.124 trillion over the same period.
Central Bank of Nigeria (CBN) monetary data show that currency outside banks increased by 103.8 per cent from ₦2.416 trillion in September 2023 to ₦4.923 trillion in September 2026. The latest figure also represents a 10.3 per cent rise from ₦4.465 trillion recorded in September 2025.
The sharpest annual movement within the period occurred between September 2023 and September 2024, when cash outside banks jumped by 66.2 per cent to ₦4.016 trillion. It then rose to ₦4.465 trillion in September 2025 before reaching its latest level.
The figures offer an important insight into Nigeria’s changing payment habits. Mobile banking, instant transfers, point-of-sale terminals and fintech applications have made electronic transactions more accessible. Yet, the volume of physical currency held outside banks shows that cash continues to occupy a significant place in everyday commerce.
This does not necessarily mean Nigerians are abandoning digital payments. Currency outside banks measures physical notes held by individuals and businesses beyond the banking system. It does not reveal how frequently they use electronic channels or why they choose to hold cash.
Inflation, transaction costs, unreliable connectivity, limited access to banking services and the needs of informal businesses may all influence cash demand, but the CBN figures alone do not establish the contribution of each factor.
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Demand deposits, meanwhile, rose by 70.8 per cent over the same three-year period, increasing from ₦22.903 trillion in September 2023 to ₦39.124 trillion in September 2026. These are funds held in bank accounts that customers can access on demand, including money used for transfers and other payments.
The simultaneous growth of cash holdings and demand deposits suggests that physical and electronic money are expanding side by side. It also means that the increase in cash should not be interpreted as evidence that the banking system is losing deposits.
Another revealing measure is the share of physical currency held outside banks. September figures put this at about 89.2 per cent of the ₦5.52 trillion currency in circulation. In practical terms, most naira notes in circulation were outside bank vaults at the time.
Economic and communications expert Clifford Egbomeade cautioned against drawing simplistic conclusions from the figures. He said the two indicators measure different parts of monetary activity and that their growth rates alone cannot establish whether the increase in cash resulted from economic expansion, inflation, informal transactions or changing payment preferences.
The figures present a challenge for the CBN’s financial inclusion and digital payment ambitions. Expanding electronic infrastructure is only part of the task. Nigerians also need reliable networks, accessible banking services, affordable transactions and confidence that digital payments will work when required.
Meanwhile, the challenge is not only about whether cash outside banks falls but also about whether Nigerians can choose between cash and electronic payments without being constrained by poor infrastructure, high charges or limited access to financial services.
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