Currency Outside Banks Drops to N3.3tn, Now 89% of CIC

Nume Ekeghe

A report by the Central Bank of Nigeria (CBN) has revealed that currency outside banks as of January 2024 marginally declined to N3.28 trillion representing 89 per cent of the N3.65 trillion total currency in circulation (CIC). 

The report showed an improved ratio of currency outside banks compared to currency in circulation, which was 94 per cent in December 2023, a staggering N3.43 trillion currency outside bank from N3.65 trillion total currency in circulation (CIC).

However, a Year on Year (YoY) comparison between January 2023 and January 2024 showed that current outside banks recorded an astonishing 314 per cent increase from N79 billion in 2023 to N3.28 trillion in 2024. 

Also looking at the same years in review, YoY for currency in circulation showed an increase of 163 percent from January 2023, which recorded N1.38 trillion while January 2024 recorded N3.65 trillion. 

A detailed breakdown of the trends in 2023 illustrates fluctuations in both Currency in Circulation and currency held outside banks. 

For instance, in January 2023, CIC stood at N1.32 trillion, followed by February at N982 billion. It closed March at N1.68 trillion and stood at N2.38 trillion in April, and May at N2.53 trillion. June witnessed a slight increase to N2.6 trillion, with a marginal dip to N2.59 trillion in July. 

August saw an uptick to N2.66 trillion, another rise to N2.76 trillion in September, and an increase to N3.01 trillion in October, culminating in the peak observed in November at N3.35 trillion.

The breakdown of currency held outside banks during the same period showed that it started at a low of N792 billion in January, experiencing a slight increase to N843 billion in February. March witnessed a reversal in the policy, resulting in an upturn to N1.45 trillion. Subsequent months saw a continuous rise to N2.07 trillion in April, N2.18 trillion in May, N2.26 trillion in June, and N2.21 trillion in July. August maintained stability at N2.22 trillion, followed by an increase to N2.42 trillion in September, N2.7 trillion in October, and a sustained upward trend to N3.08 trillion in November 2023.

December 2023 marked the pinnacle of both currency in circulation and currency outside banks, with the percentage of money held outside the banks to CIC reaching an all-time high of 94 per cent.