Nigeria cash outside banks report
The latest financial data from the Central Bank of Nigeria has brought a very serious matter to the table for discussion. According to the recent reports for November, more than 93 percent of the total cash in circulation in our country is currently sitting outside the banking system. We are talking about a staggering N4.65 trillion that is not in the vaults of our commercial banks but is instead moving from hand to hand or hidden in private places.
As an editor who has watched our economy go through many ups and downs, this particular figure is a clear signal that something is not quite right with how we trust and use our financial institutions. It is a wake up call for everyone from the policy makers in Abuja to the average trader in the market.
Why Nigerians are keeping their money under the mattress
The big question everyone is asking is why so many people prefer to hold onto physical cash rather than keeping it in a bank account. If we are being honest with ourselves, the memories of the cash scarcity that hit us not too long ago are still very fresh. Many Nigerians now feel that it is better to have your money where you can see it and touch it, just in case any emergency or “wahala” starts again.
Beyond that, the frequent network failures on banking apps and the high charges on transactions have made many people turn back to the traditional way of doing things. For the rural dwellers and those in the informal sector, the lack of bank branches nearby means that cash remains the only language they can speak fluently when it is time to do business.
The heavy weight of a cash dependent economy
Having such a massive amount of money outside the banks is not just a lifestyle choice; it has deep implications for our national economy. When the Central Bank cannot account for over 93 percent of the cash in the system, it becomes very difficult for them to control inflation or manage the value of the Naira effectively. This situation makes our monetary policy look like a toothless bulldog because the money is not where the regulators can monitor it.
It also means that banks have less money to lend to businesses and individuals who need loans to grow. Essentially, we are operating an economy that is running on manual mode in a digital world, and this is part of what keeps our growth slow and our prices high in the market.
Finding a permanent solution to our banking wahala
To bring this money back into the formal system, we need more than just circulars and warnings from the CBN. We need to build a system that actually works for the people. The banks must invest heavily in their digital infrastructure so that “transfer failed” becomes a thing of the past. There should also be a move to reduce the multiple taxes and charges that scare the common man away from opening an account.
If people can trust that their money is safe, accessible, and not being “chopped” by hidden fees, they will naturally move away from hoarding. We need to reach a point where every Nigerian, whether in the city or the village, feels that the bank is a partner and not a place where money goes to get stuck. Only then can we truly say we are moving toward a modern and efficient economy.
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