Economy
BDC Operators lament worsening cash crisis
By Tumininu Ojelabi Hassan
Bureau de change (BDC) operators have decried the worsening cash crisis in the country as this has disrupted their business operations. Despite the recent move by the Central Bank of Nigeria (CBN) to end the cash crunch experienced by Nigerians through the suspension of processing fees on cash deposits above statutory limits, Naira scarcity continues to bite harder.
Findings by our correspondent revealed that BDC operators have been relying on electronic transfers to perform business transactions, which sometimes take longer than expected due to network glitch from banks. Customers involved in the exchange of foreign currencies to Naira said since December 2023, BDC Operators have been making payments into their bank accounts through electronic transfers due to the shortage of cash. However, the few ones, who had cash rationed the cash among customers.
In an interview with our correspondent, Umaru Abubakar, a BDC operator shared his ordeal as he has resorted to paying customers through electronic transfers since this new phase of cash crisis began, and often some customers insist on cash, which creates problems for them.
“Since last year December, I have been paying customers through transfers. The cash we get from the bank isn’t enough, that’s why I have been paying through transfers because cash has become a scarce commodity. There is no cash in the banks at all. The bank I usually get cash from are giving out just N50,000 across the counter and you can’t even withdraw through the ATMs because the ATMs are empty.
“When I asked them why, they said CBN didn’t supply cash and they are managing the little cash they have. When I went to other banks, the maximum limit was within N10,000 to N40,000. All my colleagues have been complaining, we have all been paying customers through transfers,” he stated.
Tokunbo Olabanji, shared his experience when he exchanged 800 dollars for N992,000 and the BDC operator told him he couldn’t get beyond N200,000 in cash.
“On Thursday, I called my BDC operator at Yaba. I told him I needed to exchange 800 dollars. He said N1240, I told him I was selling for N1250. Eventually, I agreed to sell for N1240. I requested for cash and he told me I could get only N200,000 and he would transfer the balance. According to him, he gave me that much because I’m one of his loyal customers. He said he had been transferring money to customers due to the scarcity of cash,” he said
Bashir Yakubu, a middle aged BDC operator, who spoke with our correspondent said the cash crunch was affecting his business as customers exchanging Naira for dollars have stopped making payments in cash.
“Customers who want to change Naira to Dollars no longer bring cash to us. Before, I only accept transfers from customers I have been transacting with for a long time due to fraud related issues and network issues in banks but because of cash scarcity, I have no choice than to accept transfers from customers.
“To be on the safe side, we go into the banking hall together because I hardly accept phone transfers except I have been doing business with the customer for a very long time. If the person is a new customer, we do funds transfer inside the banking hall because you can’t trust anyone. We have had situations, where customers showed us fake alerts. We have also experienced situations, where the customer’s account will be debited but our accounts won’t be credited due to network issues. So we are always careful,” he revealed.
Ibrahim, a BDC operator at Allen avenue, Ikeja area of Lagos state was attending to a male customer, who wanted to change 400 dollars into Naira. As observed by our correspondent, the customer requested for N496,000 in cash, this was the equivalent of 400 dollars in Naira. Ibrahim was dismayed at such request despite the scarcity of cash in the country, however he pleaded to give the customer N150,000 in cash and transferred the balance.
“Oga (Boss), Where will I get cash from? N496,000 is almost N500,000, where will I get such cash from? There is no cash anywhere. Banks are not giving out cash. They have been complaining that CBN didn’t give them cash and customers are hoarding cash. If you enter the bank, they are only giving N50,000. Most of them won’t give you up to N100,000 let alone almost N500,000. Except you withdraw cash from POS agents, who are charging ridiculous fees. Oga (Boss), I can give you N150,000 in cash and I will transfer the balance to you. Customers don’t bring cash to us too,” he explained.
Chigozie Anisiobi, a businessman who wanted to change about 600 dollars to Naira but needed N300,000 cash out of the total money shared his experience.
“On Tuesday, I wanted to change about 600 dollars to Naira but I needed N300,000 cash. To my surprise, the first BDC operator I called told me I could get only N100,000 while the remaining balance would be transferred. The second guy I called said he didn’t even have cash at all, but he could only transfer to me.
I ended up going to the first guy who offered to give me N100,000 in cash. The cash situation is so bad that you can’t withdraw more than N40,000 over the counter. These days, ATMS do not dispense cash at all and POS operators charge so much now,” he lamented.
Aminu Musa, a BDC operator based in Ikorodu, Lagos expressed his concern over the non-availability of cash while interacting with our correspondent. He pleaded to CBN to treat the cash situation as a matter of urgency, adding that it was impeding their business operations.
“A customer called me yesterday, he said he wanted to change 500 dollars to Naira but he said he wanted N300,000 cash out of the total amount which was N620,000. I had just N100,000, I had to call two of my colleagues, who gave me N200,000 after much pleas. This cash scarcity is really affecting our business. We can’t withdraw enough cash from the bank, customers aren’t giving us cash also. We have been doing transactions through transfers which get delayed most times due to network issues from the bank. CBN should please come to our aid,” he appealed.
Recall that the CBN had recently suspended charges on cash deposits above the regulatory limits of N500,000 for individuals and N3 million for corporate account holders, despite this, banks are still lamenting over low cash deposits.
The apex bank stated that the suspension of the charges shall remain effective until April 30, 2024 and directed all banks to comply with the latest development.
“The Central Bank of Nigeria hereby suspends the charging of processing fees of 2% and 3% previously charged on all cash deposits above these thresholds with immediate effect. This suspension shall remain in effect until April 30, 2024. Consequently, all financial institutions regulated by the CBN should accept all cash deposits from the public without any charges going forward,” the statement said.
