Despite repeated assurances by the Central Bank of Nigeria (CBN) that there is enough currency in circulation, the cash scarcity in Lagos metropolis, Ogun and other major cities have continued unabated with banks now limiting the amount of cash customers could withdraw.
According to a POS operator in the Opebi area of Lagos State, Jobs Akingbade, some banks “only release N20,000 per day”, and due to an increase in withdrawal as the festive period draws nearer, the cash tightening is becoming worse.
Recently, CBN’s acting director of Corporate Communications, Hakama Sidi-Ali, said in a statement that there is sufficient cash in circulation.
“There is indeed an increase in currency in circulation. From N1 trillion in February 2023, we have seen a rise to over N3.4 trillion as of December 11, 2023.
“This demonstrates that enough cash is available, but unfortunately, it’s not circulating due to apprehension among some individuals,” she said.
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In addition, she held those deliberately hoarding cash responsible for the shortage, tying it to the challenges stemming from the naira redesign policy.
Even though the apex bank has ordered that both the new and old naira notes be spent simultaneously until further notice, many still fear that a policy reversal can be announced anytime by the apex bank, thus hoarding the new naira notes in circulation.
Also, due to the holiday season, a lot of people are hoarding the cash with them to spend for the Christmas and New Year holidays.
Consequently, this has increased by cash withdrawal as most Nigerians tend to spend more on shopping, travelling and other expenses for the holiday.
The CBN’s acting director of Corporate Communications, Hakama Sidi-Ali, also noted this phenomenon as one of the factors responsible for the cash crunch during this period.
“We empathize with the recent and past experiences of Nigerians. The CBN assures everyone that we have adequate cash to meet daily transaction needs, even during the upcoming festive season.”
Meanwhile, Some POS operators in Lagos and Ogun have increased their transaction charges, adding that it’s becoming increasingly difficult for them to access the naira from their banks or ATMs.
Akingbade revealed that he now charges N200 for N5,000 and N300 for N10,000, indicating a 100 per cent and 50 per cent increase in transactions depending on the amount of money transacted from him.
According to him, banks are withholding cash, forcing POS merchants to buy money at a higher cost than usual.
He also revealed that security guards in the bank don’t even allow POS operators to access the ATM, adding that it is usually reserved for POS non-operators.