Anxiety over cash scarcity grows as Christmas approaches

By Tumininu Ojelabi Hassan

Nigerians are currently struggling with another phase of cash scarcity as banks cut down on cash transactions due to the shortage of cash in the banking system.

As Christmas is draws nearer, most people are anxious over the scarcity of cash as this can impede the preparation for the yuletide. Business Hallmark gathered that customers, who visited the banks to withdraw cash could only withdraw little amounts of money across the counter, while only a few customers could withdraw cash through the Automated Teller Machine (ATM).

Our correspondent, who visited eleven commercial banks on Allen avenue, Ikeja on Friday, discovered that most ATMs in these banks were not dispensing cash except UBA and Access bank. Customers were either directed to withdraw cash over the counter, while those, who could not wait due to long queues in the banking hall resorted to withdrawing through the POS terminal.

At the First bank branch on Allen avenue, customers’ expectations of withdrawing cash was met with utmost disappointment as none of the four ATMs in the branch dispensed cash. A similar situation was observed in Zenith bank, Allen avenue branch, where none of the two ATMs at the branch dispensed cash. The security officers in the bank told customers, “There is no cash, the ATM is not dispensing”.

A customer of Zenith bank, Temitayo Lawal, who spoke with our correspondent said he had been experiencing this for the past three days, adding that almost all the banks he visited didn’t have cash.

“I noticed there was cash scarcity three days ago, when I tried to withdraw and I was told there was no cash. I checked three other banks on this road, their ATMs weren’t dispensing too. I had to withdraw cash using the POS,” he said.

The situation at the UBA branch on Allen avenue was different as customers were seen withdrawing cash at the bank’s four ATMs seamlessly. However, the withdrawal limit was N40,000, the security office revealed this while responding to a male customer, who wanted to withdraw N50,000 but could only withdraw N40,000.

The Keystone bank along the Allen avenue had no cash. Based on our correspondent’s observation at the bank, as customers approached the ATM gallery, the security officers informed customers that the bank had no cash. Similarly, at the GTCO Allen avenue branch, about seven customers, who tried to withdraw cash were unable to as the three ATMs in the branch did not dispense cash, however the security officers directed customers into the banking hall. Customers were seen lamenting over the long queues in the banking hall. Some customers, who were in a haste left, while others proceeded to withdraw over the counter.

Amarachi Onwumere, a 48-year old trader, who spoke with our correspondent, said she tried to withdraw at the ATMs of four different banks but she couldn’t as none was dispensing cash.

“I have been to four different banks before I came here, none was paying. In some banks, immediately you walk towards the ATM point, the security officer tells you ‘No cash, the ATM is not dispensing’. I just hope this cash scarcity won’t be as bad as the one in February, because Christmas is approaching and I can’t imagine running around for cash during Christmas,” she shared.

According to a security officer, who spoke with our correspondent, the scarcity of cash was from the Central Bank of Nigeria (CBN), which failed to supply cash to commercial banks.

“It’s not our fault, cash is scare because CBN is not supplying cash to us. This has been going on for two weeks now. The cash customers have been withdrawing are from deposits,” he said.

At Access bank branch along Allen avenue, about nine customers were on a queue waiting to withdraw cash at two ATMs dispensing cash. Each customer spent averagely five minutes at the ATM gallery. The two ATMs at Eco bank, Allen avenue branch didn’t dispense cash. In the same vein, the ATM galleries at Unity Bank, Lotus bank, Globus bank and Jaiz bank were empty as the ATMs did not dispense cash.

Chinonso Donatus, a 39-year old business man, shared his experience with our correspondent, he lamented over the shortage of cash as his efforts to withdraw N60,000 cash at over six banks proved abortive.

“Last week Saturday, I wanted to withdraw N60,000 from the ATM. I tried withdrawing at First bank, but none of the ATMs dispensed cash. Then I went to Access bank, I was able to withdraw N10,000. Afterwards, I went to Zenith and GT bank, I was able to withdraw N5000 each from the the two banks. I went to four other banks but all their ATMs didn’t dispense cash. It was really frustrating because I was going from one bank to the other only to end up with N20,000 out of N60,000,” he narrated.

A manager of a top bank, who spoke with our correspondent on condition of anonymity said, the scarcity of cash is due to CBN’s failure to supply cash to the banks, adding that banks are not hoarding cash as most customers assume.

“Customers have been complaining bitterly but what they don’t understand is that this is beyond our control. It is not possible for us to have cash and not give customers. Since Monday, I have been paying customers N20,000 over the counter and N10,000 for ATM withdrawal, while non-customers can only withdraw N5,000 at the ATM.

“I have been requesting for cash for the past three days, and we haven’t gotten cash since then. Normally, when we request for cash, we get it the next day. The cash we have been paying to customers are from deposits. When customers get angry and accuse us of hoarding cash, I let them know this is not a situation of hoarding cash, we don’t have cash too,” she clarified.

CBN said the scarcity experienced in some locations was due to high volume withdrawals from its branches by banks and panic withdrawals by customers from ATMs. This was disclosed in a statement by Isa AbdulMumin, CBN director, Corporate communications, on Thursday.

“Our findings reveal that the seeming cash scarcity in some locations is due largely to high volume withdrawals from the CBN branches by Deposit Money Banks (DMBs) and panic withdrawals by customers from the ATMs,” CBN said.

The apex bank assured the public of availability of naira notes for economic activities in the country, adding that it was working towards ensuring circulation of cash across the country.

“While we note the concerns of Nigerians on the availability of cash for financial transactions, we wish to assure the public that there is sufficient stock of currency notes for economic activities in the country.

“The branches of the CB across the country are also working to ensure the seamless circulation of cash in their respective states of operation.

“Members of the public are, therefore, advised to guard against panic withdrawals as there is sufficient stock to facilitate economic activities,” CBN added.

CBN advised Nigerians to use alternative modes of payment to reduce pressure on using physical cash.

Recall that, in the first quarter of 2023, the country experienced a cash crunch following the implementation of CBN’s Naira redesign.