(3 Minutes Read)
Fresh developments in the Nigerian financial sector have shown that despite the Central Bank of Nigeria’s (CBN) move to ameliorate the cash crunch situation by suspending charges for cash withdrawals above regulatory limits, scarcity of currency notes in the banks nationwide has continued to hit hard.
Banks across the country have continued to ration cash withdrawals in the banking halls and through their Automated Teller Machines (ATMs) while Point of Sale Operators, PoS, operators, have taken advantage by hiking transaction fees by not less than 100%.CBN was accused recently for cash withdrawals above the regulatory limits of N500,000 for individuals and N3 million for corporate account holders, nonetheless, banks still peg customers’ withdrawals far below the statutory limits.
Commenting on the biting Naira scarcity, Former Director General of the Lagos Chamber of Commerce and Industry (LCCI) and CEO, of the Centre for the Promotion of Private Enterprise (CPPE), Muda Yusuf, said it is a case of economic sabotage, arguing that there is no basis for scarcity with currency in circulation at N2.5 trillion. He, therefore, called on the CBN and the security agencies to put a stop to what he described as racketeering in the banking system.
The current cash scarcity is a case of economic sabotage. Currency-in-circulation, going by CBN data, is over N2.5 trillion, which is about what it was before the naira redesign crisis. There is, therefore, no basis for scarcity, except if there is a deliberate act of sabotage. The CBN has a responsibility to investigate and identify those behind this. There is no compelling or rational argument to support the hoarding theory. We are not in an election season and there are no imminent nationwide elections at the moment. So, what value will hoarding be for anyone?
Business transactions are already being disrupted, especially in the distributive trade sector, the informal sector, and the intra-city transport sector due to the scarcity. Yusuf further stated that if the situation persists, it would not be out of place for the CBN to print more currency notes.
Read Also:
https://trendsnafrica.com/currency-crisis-in-nigeria-creates-havoc/
https://trendsnafrica.com/nigerias-apex-court-faulted-withdrawal-and-redesign-of-currency/
https://trendsnafrica.com/nigerias-external-reserves-fall-after-currency-float/
The scarcity of cash in a cash economy, like Nigeria’s economy, is not something to condone. Its negative consequences are too numerous to mention. The informal sector which dominates the economy is feeling the heat seriously. Petty transactions that sustain petty traders and common people are getting eroded. As a matter of urgency, CBN should intervene by adequately supplying, especially, N50, N100, and N200 denominations.
