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•PoS operators fleece hapless customers
Amid ongoing cash scarcity crisis, the amount of currency circulating outside Nigeria’s banks skyrocketed to N4.65 trillion in November.
The sharp rise, analysts note, reflects the growing challenges faced by Nigerians as limited access to bank withdrawals forces many to rely on physical cash for day-to-day transactions. The surge in currency outside the banking system highlights not only the deepening liquidity crisis but also the strain it places on businesses and consumers, exacerbating the nation’s economic difficulties.
Data from the CBN showed a significant increase in cash held outside the banking system, up by N364.38 billion or 8.5% from N4.29 trillion in October.
Total currency in circulation also climbed to N4.88 trillion, reflecting a month-on-month rise of N328.91 billion or 7.2%.
The new high underlines Nigeria’s continued reliance on cash for transactions, even as the CBN works to promote digital payments.
On a year-on-year basis, the amount of currency outside banks rose by 51% compared to n3.08 trillion recorded in November 2023.
With a few hours to the end of 2024, many Nigerians are now at the mercy of Point of Sales (PoS) operators as most banks’ Automated Teller Machines (ATMs) across Lagos metropolis remain empty.
Inside the banks, the situation offers no relief, with most financial institutions turning customers away due to a severe cash shortage. On the rare occasions when withdrawals are possible, customers are limited to as little as N10,000 or N20,000. This persistent cash crisis continues despite a recent warning from the Central Bank of Nigeria (CBN) that any bank failing to dispense cash through ATMs would face sanctions.
“It’s been incredibly frustrating. I’ve visited three different banks today, and none of them has cash available. How are we supposed to celebrate the season like this?” lamented Amaka Okonta, a frustrated Lagos trader.
The situation has left many Nigerians who need cash for the end of the year purchases at the mercy of PoS operators, who are now taking advantage of the scarcity to impose exorbitant charges on cash withdrawals.
In some parts of Lagos, a typical PoS transaction now attracts fees as high as N500 for a withdrawal of N5,000—a sharp contrast to the N100 or N200 that was the norm a few months ago.
For larger amounts, the charges are even steeper, leaving customers with no choice but to pay the inflated rates.
“I had to withdraw N10,000 yesterday, and the PoS operator charged me N1,000. It’s unfair, but what can I do? I needed the cash,” lamented Mr. Wale Alade, a public servant residing in Ikeja area of Lagos.
For many Nigerians, who rely on cash for daily transactions like transportation, feeding, and small purchases, the situation has been particularly dire.
Last month, the CBN Governor, Mr Yemi Cardoso, asked Nigerians to report any bank hoarding cash for necessary action.
