Credit Outside Banks, CIC Decline First Time Since Feb 2023

Having hit the highest level in January this year, the amount of cash in circulation in the country recorded its first decline since February 2023, as the volume of cash outside the formal banking system declined slightly in February 2025.

Cash in circulation had been on the upward trend for years, seeing a significant decline in February of 2023, in the height of cash scarcity, triggered by a recall of old notes and introduction of the redesigned naira noted by the President Muhamadu Buhari administration.

Latest data released by the Central Bank of Nigeria showed that money supply, currency in circulation and currency outside banks all saw a slight decline in the month of February compared to what it was in January.

According to the data, currency in circulation was down to N5.037 trillion in February of 2025 compared to N5.235 trillion which it was in January 2025. The figure is however still higher than N3.693 trillion that was in circulation in February of 2024.

Similarly, currency outside the banking system declined by 4.7 per cent from N4.737 trillion in January this year to N4.515 trillion last month. This brings the percentage of the currency in circulation that is outside the banking system down to 89.63 per cent in February from 90.5 per cent in January this year.

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Money supply (M2) which had risen to N110.93 trillion in January this year declined to N110.307 trillion in February. Quasi Money was down to N72.738 trillion from N74.163 trillion in January while demand deposits continued to rise standing at N33.053 trillion in February compared to the January figure of N32.029 trillion.

Meanwhile credit to the private sector, which had declined to N74.915 trillion in January from N75.96 trillion in November last year, continued to drop.

The CBN data showed a 1.7 per cent decline in credit to the private sector in February to N73.664 trillion.

However, credit to the government rose last month after a substantial decline in January, boosting net domestic credit. Lending to the government had risen from N24.526 trillion in January to N26.49 trillion in February as net domestic credit rose from N99.442 trillion to N100.154 trillion in February.