A cash crunch has struck the nation’s capital, Abuja, resulting in long queues at several bank branches, as revealed by an investigation conducted today .
The cash shortage can be attributed to several factors, including a surge in demand for cash ahead of the yuletide and logistical challenges in currency distribution, reports Vanguard.
This scarcity of cash has compelled Point-of-Sale (PoS) operators to double their charges, as customers are observed patiently waiting in extended queues outside bank branches to withdraw money.
At First Bank Plc’s Mpape branch, customers were restricted to a withdrawal limit of N20,000. These limitations have imposed a substantial strain on Nigerians needing access to cash.
Interviews with various PoS agents provided insight into the difficulties they are facing amidst the cash shortage.
An agent, who simply wished to be known as Mama Precious, revealed that she had to plead with bank officials to withdraw N30,000 from the bank’s bulk room.
Recounting her ordeal, she highlighted the hardships local cash agents are experiencing in order to meet demand.
“I had to beg the bank officials in the bulk room before they grudgingly handed over N30,000,” she narrated.
A similar situation is evident at Zenith Bank Plc’s Jabi branch, where Chinwendu Daniel’s brother endured a wait of roughly five hours in line to withdraw N30,000.
In reaction to the cash shortage, PoS operators along Ajegunle road in Mpape have doubled their charges. Now, they charge N200, N400, and N800 to dispense N5,000, N10,000, and N20,000 respectively, a significant hike from the N100, N200, and N400 rates as of last weekend.
However, not all PoS operators are suffering. Torkwase Kumbul, a PoS business operator at Stafic Energy Ltd’s filling station in Ketti, Lugbe District, mentioned she has ample cash available and could dispense up to N40,000 per customer for N500.
“My customers can withdraw up to N40,000 for only N500,” stated Kumbul, highlighting the differences in the coping mechanism of PoS operators amidst this financial crunch.
Nevertheless, the surge in service charges is an added burden on citizens already struggling with economic pressures, and it illustrates a vivid picture of the current economic scenario where cash access is increasingly both a luxury and a hurdle.
As the cash shortage intensifies, both customers and PoS operators are urging the banks to promptly address the issue to mitigate the escalating frustration and inconvenience.
How are the banks responding?
Each bank’s strategy to deal with the cash crunch may differ based on regulatory guidelines, and customer behaviour, but the goal remains to strike a balance between meeting cash demands and promoting digital payment adoption to maintain efficiency and prevent potential cash shortages.
A confidential source from First Bank Plc, Mpape branch, conceded that the public’s frustration is palpable as the current situation hinders daily financial operations and impacts the overall economy.
However, he assured that the commercial banks are working diligently with the Central Bank of Nigeria (CBN) to ensure an adequate cash supply to meet customer needs.
“The CBN is partnering with us (commercial banks) to identify and address these underlying issues to prevent future cash shortages,” the source stated.
Regarding specific measures the bank has undertaken to adapt to the increased cash demand, he shared, “We have escalated the frequency of cash pickups from the CBN and are collaborating with PoS operators to streamline and optimize cash distribution.
“Also, we have temporarily adjusted withdrawal limits to manage liquidity and are encouraging online transactions to reduce the reliance on physical cash.”
