Mary Onyia
It’s a few days to Christmas and families may be unable to give their loved ones special treats owing to the worsening cash shortage in the country. With the increased demand for cash for shopping and business transactions as the yuletide approaches, cash scarcity will have dire consequences on the mood of people and the economy in general.
Recall that the cash scarcity started after the redesign of the naira notes by the then former and now embattled Central Bank of Nigeria, CBN, governor, Godwin Emefiele.
The reappearance of the lack of cash elicited an intensive cash rationing by banks, thereby further compounding the severe economic challenges confronting Nigerians daily, which are driven by high prices of goods and services.
Cash withdrawal limits in most bank branches range from N5,000 to N10,000 for over-the-counter and automated teller machine (ATM) transactions. This is despite the recent warnings by the apex bank to commercial banks to ensure efficient cash disbursement.
Many have attributed the cash crisis to limited cash supply by the CBN and low cash deposits. They blamed the apex banks for failing to meet the demands of the commercial banks even as retailers profit by selling cash instead of depositing it back into the banking system. This led to the House of Representatives calling on the CBN to urgently address the situation that has disrupted economic activities, with attendant hardship to the people.
With the festive season near and more people needing cash for various transactions, people hoard money as retailers fail to heed the call to deposit funds into the banks.
Experts are advocating for a shift away from cash dependency into a cashless economy stressing that a cashless economy is cheaper, safer, and more efficient for the economy.
The President of the Association of Senior Staff of Banks, Insurance, and Financial Institutions, ASSBIFI, Olusoji Oluwole, reportedly encouraged a cashless economy.
He said: “An economy that operates in a cashless manner does better than a cash-dependent economy. It is a proven thing all over the world,” and called for a dismantling of illegal currency trading.
“You cannot be selling cash. You cannot sell your currency to people for a profit at discounted rates. It is not done anywhere,” Oluwole reportedly said and advised a probe into the activities of the point-of-sales operators buying cash from fuel stations and supermarkets. These POS operators retail this cash to their customers, sometimes, charging N500 to get between N10,000 to N20,000.
Recently, the CBN, in a circular signed by the CBN’s acting Director of Currency Operations, Solaja Olayemi, and its acting Director of Branch Operations, Isa-Olatinwo Aisha, urged members of the public who are unable to obtain cash Over-the-Counter or through ATMs at DMBs, to report such instances using the designated reporting channels and format provided, the CBN had also promised.
It remains to be seen what new measures the apex bank would take, with just less than two weeks to Christmas.
With additional reports from Punch