Reports of scarcity have emerged across the country despite recent assurances by the Central Bank of Nigeria (CBN) that there is enough naira in circulation.
A survey on Wednesday confirmed scarcity in some parts of Abuja, Lagos, Kano, Kwara, Gombe, Edo, Sokoto, and Ekiti states.
Many bank customers and Point of Sales (POS) operators lamented that it is becoming a challenge to access cash for their economic activities.
This is coming weeks after the CBN affirmed that it has enough currency notes in the market and hence no need for panic withdrawals by members of the public.
In a circular titled ‘All Banknotes Issued by the CBN Remain Legal Tender,’ signed by Director, Corporate Communications, Isa AbdulMumin, the bank stated that it was aware of reported scarcity of cash across some major cities. It noted that there have also been concerns among some members of the public over the legality of old naira notes.
The bank said, “For the avoidance of doubt, while reiterating that there are sufficient banknotes across the country for all normal economic activity, we wish to state unambiguously that every banknote issued by the Central Bank of Nigeria (CBN) remains legal tender and should not be rejected by anyone, as stipulated in Section 20(5) of the CBN Act, 2007.”
It cautioned members of the public to avoid panic withdrawals and stressed that it has enough currency notes to facilitate normal economic activities.
The concern from members of the public over the legality of old naira notes is connected to issues surrounding the naira redesign policy of the apex bank.
However, cash scarcity, a major downside of the CBN’s naira redesign policy, has begun to resurface. Visits to some banks on Wednesday revealed scanty banking halls and ATM galleries.
A customer, who gave his name as Ganiyu Tunde, at the Union Bank branch along Oshodi Expressway in Lagos claimed that banks were only dispensing N5,000 via ATMs to non-customers.
Bank customers of Union Bank were, however, able to get up to N20,000 at the ATM and inside the bank.
The rows of ATMs at an Access Bank branch nearby were empty because there was no cash in them as of the time of filing this report.
A banker who spoke on the condition of anonymity blamed the cash scarcity on weak supply from the CBN.
“It is the CBN that is responsible for this cash scarcity. We are not getting enough from them. They are just causing unnecessary suffering for the masses,” the source told Punch.
A respondent in the Federal Capital Territory, Festus Okoromadu, was concerned that he could not withdraw at the First Bank branches in his area.
“What I was told was that the bank’s network was temporarily unavailable, which made the transaction impossible. This has been the case at some of the banks in the FCT in recent times, withdrawing money is becoming more challenging,” he said.
In Kano, some commercial banks were not honouring withdrawal requests from customers, and ATM galleries.
It was further gathered that the few banks that were paying customers did not give beyond certain amounts.
A customer who simply gave his name as Hayatudeen said, “Many banks lack money to give to customers and when you inquire, they will not give you any satisfactory explanation as to why.”
He noted that the story is the same with POS operators because they are also complaining of scarcity.
He added, “Even though most of the POS operators are getting their money from traders and other business operators, they still complain of the scarcity.”
He further alleged that many POS operators have increased their charges by about 50 per cent.
In Kwara, banks are rationing cash to their customers as some commercial banks are not allowing customers to withdraw more than N20,000 daily from their accounts.
Some of the bankers noted that customers are no longer bringing in a lot of cash to save in their accounts leading to the shortage of cash.
One banker said, “Banks do not have enough cash to pay out to customers because people are not bringing money to the bank.
“We only ration the available money among the customers. Anyone that comes to withdraw is paid N20,000 but few highly placed customers are given N50,000 when they come to withdraw.”
In Ekiti State, an official at the Union Bank branch, Okesa Ado Ekiti, revealed that the branch was unable to meet the specific withdrawal demand of its customers because “there is no sufficient cash for now. We give what we can afford to ensure it goes around.”
A bank customer of one of the First Bank branches in the capital city, who only identified herself as Tope, lamented, “I do not know exactly what the problem is, but no customer was able to get more than N10,000 – N20,000 in the bank hall. I learnt it was the same story at their ATMs in the bank.”
At the ATM points of Wema Bank, Okesa area, bank customers with Wema Bank ATM cards could withdraw N20,000. Customers with ATM cards from other banks could only withdraw N10,000.
In Sokoto State, a resident, Kabiru Nura, said: “Even though the issue is becoming more relaxed the scarcity is still very much with us. The funniest part is at ATMs, you hardly get cash at ATMs these days. The last time this happened was during the naira redesign policy, and this should really be a thing of the past now.”
PoS operators in Gombe State are worried about the resurging naira scarcity in the state.
Adamu Salisu, who operates a stand in the Bagadaza area of the state, said, “All of a sudden, we cannot get free access to lump sum of cash. I and some of my colleagues now rely on traders in the market who get some cash from transactions to remain in business.”
Also speaking, Sandra James, a resident in the state, continued, “Many people prefer to do transfer through phone as just a few have access to funds. It is sad.”
Another PoS operator, Mohammed Rafi, added, “We are going through so much stress to get money to give customers, but customers are complaining because we have increased our charges as we had previously done during the early part of the year.”
In Edo, POS operators, store owners, and bank customers lamented their inability to get cash.
A POS operator, who only gave her name as Faith, declared that cash is scarce in Benin as banks now ration the amount that can be withdrawn at the ATMs.
She said, “I noticed that the scarcity of cash began late last week. You can only get N20,000 from your bank’s ATM and those who come with other banks’ ATM cards may get N10,000. They also refuse to pay across the counter while you can get N10,000 if you are lucky.
According to the President of the Bank Customers Association of Nigeria, Dr Uju Ogunbunka, members have reported any such issues with cash withdrawals.
He said, “This news surfaced a few weeks ago, and some of the banks I visited gave out cash to their customers. If there is a limitation at all, then it means something is driving it. But I see no reason because there is no issue regarding whether it’s new notes or old notes; that problem has already been resolved. But if anything is driving this report, I think we need to find out.
“Maybe they want to encourage online banking and things like that. But I don’t think there is anything like a cash squeeze now. I will try to visit some banks and see for myself. The information I have now doesn’t suggest anything like a cash squeeze.”
The National President of the Association of Mobile Money and Bank Agents in Nigeria, Victor Olojo, added that more needs to be done in terms of increasing alternatives to cash.
“The CBN hardly has control of the whole cash issues, and they need to be very clear on if it is the old currency we are using or the new, they are the custodian of our currencies. However, we as a country are on a good trajectory. In terms of raising other channels of payments, more needs to be done,” Olojo said.
