BREAKING: Naira Scarcity Worsens As Major Commercial Banks Exhaust Cash

The crisis rocking the nation over the controversial naira redesign and cashless policy introduced by the Federal Government through the Central Bank of Nigeria (CBN) may worsen in the coming weeks.

Recall that the Supreme Court had extended the validity of the old naira notes until December 31st, but the silence of President Muhammadu Buhari on the judgment of the apex court had fuelled the rejection of the remaining old N1,000 and N500 as legal tender. Some banks had on Monday commenced paying customers the old notes in partial compliance with the Supreme Court judgment, but by Wednesday, the banks stopped disbursing the old notes as the CBN insisted that it had not given any directive to that effect.

 

It was gathered on Friday that cash had dried up in most banks in Lagos and Ogun states due to what senior bankers described as the inability of the CBN to supply them with new naira notes.

A branch manager of a Tier-1 bank revealed that his branch last received cash last Tuesday, adding that bankers were also frustrated about the currency crisis affecting the nation.

The Lagos-based branch manager told The PUNCH, “There have been no supplies of new naira notes to my branch and other neighbouring branches this week. The last supply we got was N5m last week Monday and another N5m the following day. Members of our bullion van team have been on standby throughout this week, awaiting signals to come to the CBN to pick cash, but there has been no signal. The N10m we got last week didn’t last up to Wednesday.

“Following the Supreme Court judgment, we were initially paying out the old N1,000, and N500 notes deposited with us and which had not been deposited with the CBN to desperate customers, but we had to stop when the customers came back to complain that people were not accepting the old notes from them.”

Another senior banker added that his first-generation bank had not been supplied new naira notes to disburse to customers.

He said, “Even me as a banker, I can only boast of N100 as I am speaking to you. We have not been supplied with cash this week. The Nigeria Inter-Bank Settlement System Instant Payment platform is not working; the digital payment systems are overwhelmed. When you see crowds at our branches now, we are not giving them cash. What we are doing is to deal with complaints arising from digital payments.

“I think it is deliberate not to supply naira notes to the banks because the government and the CBN don’t want politicians to mop them up. Politicians are desperately looking for cash to pay their agents now. I know of a candidate for the Lagos State House of Assembly who has launched a passionate appeal to his friends to raise money to pay his party agents, who were not paid after the presidential and National Assembly elections and threatened not to take part in the governorship and state House of Assembly. “

An operations manager in one of the commercial banks said his branch had been unable to dispense cash to customers because it did not have any.

She explained that her branch had not received any cash from the headquarters in the last one month and that the most recent any of the nearby branches received cash was two weeks ago.

“The cash scarcity is getting worse. Even as a bank worker, I don’t have cash to spend. We have not been receiving money from the headquarters and so we have nothing to give to customers,” she told the publication.

Asked if they had a directive to dispense the old notes in compliance with the Supreme Court ruling, she said, “No, there is no communication from our headquarters in that regard. We have some old notes that customers deposited, which we can pay for now, but we don’t have an instruction to disburse them.

“Ordinarily, people expected the banks to start paying the old notes immediately after the Supreme Court ruled on the matter on March 3, but we needed a directive from the CBN through our headquarters to do that. So, the challenge is three-pronged; the CBN did not release the old notes for us to circulate; we don’t have the authorisation to dispense the old notes we have in our vault; and the CBN has refused to supply us new notes. That is what is responsible for the scarcity everywhere.

“The last time my branch received old notes was early February, about a month ago. Our zonal branch received N3m from the headquarters, and under that zone, we have eight branches. By the time that was shared between the eight branches, what got to the branches was insignificant, and it didn’t even last a day. Don’t forget that the bankers are also cash-strapped.”