Cash Outside Nigerian Banks Drops After Rate Cut

Following a reduction in the monetary policy rate by the Central Bank of Nigeria (CBN) during its Monetary Policy Committee meeting in February 2026, cash held outside the banking system fell by N104.76 billion from N5.19 trillion in February to N5.08 trillion in April 2026. This represents a decline of 2.02 percent within the two-month period.

The total currency in circulation also decreased by N63.46 billion, from N5.71 trillion in February to N5.65 trillion in April 2026. The currency outside the bank accounted for 90.03 percent of total currency circulation in April, down from 90.87 percent in February.

Despite the decline, the cash level remains above figures recorded in the same period in 2025, indicating a year-on-year rise of 11.29 percent. Additionally, bank reserves increased sharply from N32.74 trillion in February to N34.60 trillion in April 2026, reflecting a year-on-year increase of 5.68 percent.

The CBN had reduced the monetary policy rate by 50 basis points to 26.5 percent during its 304th meeting held in Abuja.