CBN to Investigate Banks Amidst Persistent Cash Scarcity

The ongoing cash circulation crisis in Nigeria shows no signs of abating, with the Central Bank of Nigeria (CBN) hinting at forthcoming investigations into the matter.

Bank customers have been vocal about the severe cash shortages affecting their daily lives, with most banks limiting cash withdrawals over the counter and from ATMs to between N10,000 and N20,000 per day. Customers also report that many ATMs remain empty for days on end.

Curiously, while banks struggle to dispense cash, Point of Sale (PoS) operators, often located near these banks, seem to have ample cash to offer. This discrepancy has led to suspicions that banks may be colluding with PoS operators to exploit customers, forcing them to pay additional fees for cash withdrawals. Some customers even allege that bank officials own these PoS services.

However, investigations by Vanguard reveal no such collusion. Both banks and PoS operators report difficulties in accessing cash. Mrs. Beauty Omobola, a PoS agent, shared her frustration: “It is difficult to get cash from the banks now. I used to withdraw N100,000 to N200,000 over the counter, but now the limit is N50,000.”

Another PoS agent, Mr. Jerry Iduzogie, echoed this sentiment: “My bank, which previously allowed withdrawals up to N200,000, now limits me to N20,000. I’ve had to rely on my wife’s friends, who are traders, to source cash.”

Miss Rebecca Daniels, also a PoS agent, noted that cash is increasingly staying out of banks: “Many Nigerians no longer deposit their cash in banks. Shops now use PoS terminals for transactions, keeping cash in circulation among the public.”

Bank tellers have admitted to cash supply issues, stating they dispense all available cash daily, rationing it based on availability. One teller explained: “We receive limited cash from the CBN and depositors, sometimes only able to give out N20,000 to N50,000 per customer.”

The CBN, concerned about the persistent cash scarcity despite supplying cash to banks, plans to investigate. Any banks found engaging in malpractice will face sanctions.

In related news, the CBN reported a month-on-month decline in Currency Outside Banks (CoB) by N27.5 billion or 0.55% to N3.6 trillion in April 2024, suggesting a reduction in cash availability in the system. This marks the first decline in CoB this year, following a 4.37% drop in January. Analysts believe this reflects the current case shortage crisis.