The Central Bank of Nigeria (CBN) has revealed a striking increase in the amount of currency held outside the banking system, which has risen by 103.8% over the past three years, reaching N4.923 trillion in September 2026. This figure marks a substantial increase from N2.416 trillion recorded in September 2023, underscoring a persistent demand for cash despite the growth of electronic payment options in the country.

Data from the CBN's Money and Credit Statistics indicates that the amount of cash outside banks has not only doubled since 2023 but also increased by 10.3% year-on-year from N4.465 trillion in September 2025. The trend highlights a significant reliance on physical cash among Nigerians, raising concerns about the effectiveness of initiatives aimed at promoting financial inclusion and the use of digital payment systems.

A detailed breakdown of the figures shows that cash outside banks surged by 66.2% from N2.416 trillion in September 2023 to N4.016 trillion in September 2024. The growth continued, with the amount rising to N4.465 trillion in September 2025, reflecting an 11.2% increase from the previous year, before reaching the current total of N4.923 trillion.

In addition to the surge in cash holdings, demand deposits in the banking system also saw a notable increase, climbing by 70.8% to N39.124 trillion in September 2026 from N22.903 trillion in September 2023. The CBN's data shows that demand deposits rose to N31.842 trillion in September 2024, a 39.0% increase compared to the previous year, and further increased to N34.642 trillion in September 2025 before reaching the latest figure.

Economic experts have pointed out that the simultaneous rise in both cash outside banks and demand deposits indicates a complex relationship between cash and banking activity in Nigeria. Clifford Egbomeade, an Economic and Communications expert, noted that while demand deposits reflect bank-account balances, currency outside banks represents cash held outside the formal banking system. He emphasized that the growth rates of these two indicators alone do not clarify the reasons behind the increase in cash holdings, which could be influenced by factors such as economic growth, inflation, informal transactions, or shifts in payment preferences.

This trend raises important questions about the future of cash transactions in Nigeria and the effectiveness of ongoing efforts to enhance digital banking and financial inclusion. As the country continues to navigate the balance between cash and electronic payments, the CBN's findings serve as a critical reminder of the challenges that lie ahead in transforming the financial landscape.