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Supreme Court Ruling: End to cash crunch not imminent — Bankers

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Monday, March 6th, 2023
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At the backdrop of the relief from the Supreme Court judgment on old Naira notes, respite was far from over, weekend, as long queues at ATM locations continued.

Vanguard MoneyDigest investigation showed that the improvement in cash supply to banks the previous week, prompted by President Buhari’s order extending the status of the N200 as legal tender, vanished last week with bank officials reducing the amount of cash withdrawal per customer.

Confirming this development to Vanguard MoneyDigest, a Branch Head of one of the banks in Ikeja, Lagos, said that cash supply to branches dropped to between N500,000 and N1 million last week, from between N4 million and N3.5 million last week.

Speaking on condition of anonymity, the official said: “We had an increase in supply when the N200 notes were returned.

“Before then weekly supply was about N1.5 million. But after the President extended the  legal tender status of the N200 notes, supply increased to between N4 million and N3.5 million comprising N3 million of old N200 notes and N500,000 of new notes.

“But this week, supply reduced to between N1 million and N500,000 and consisted of only new notes depending on the size of the branch.”

Another Tier-1 bank  official in one of the branches located at Abulado, Old Ojo Road, Lagos, said that the last delivery of cash supply to the branch was two weeks ago; Thursday, February 23.

“The last time we had supply was on Thursday. Since then, nothing has come to this branch. We are hoping that things will improve next week,”  he said.

Similarly, a top branch official in one of the Amuwo Odofin branches of another Tier 1 bank,  who  on condition of anonymity, said, “The CBN did not release enough cash to the banks,” adding that the branch only received N1 million naira since the beginning of the week.

He also noted that the cash given out is not coming back into the banking vaults as nobody was depositing cash.

“The small cash being pushed out is not coming to the bank, neither did it return to the market. Nobody wants to part with the little cash on them.

“This shows that there are big challenges ahead if the CBN refuses to push more money out,” he stated.

In Marina, Lagos Island, a bank staff  who spoke to Vanguard MoneyDigest on condition of anonymity, said most of the new notes brought to the branch have long been dispensed and the few ones brought today have been loaded in the Automated Teller Machines, ATM.

“The last batch of new notes were dispensed last week (the previous week)  before the election. The amount being brought has not increased and we have to ration it at the ATMs so that every customer can go home with cash.

“Today we were given money and it has been loaded in the ATM. As you can see, this is the weekend and everybody needs cash.

“There is no payment over the counter for now as we don’t have the old N200 notes on the ground.”

Another bank staff, who spoke on condition of anonymity, said the branch has been dispensing the old N200 notes over-the-counter and doesn’t have new notes for the time being.

“There are no new notes on the ground. We pay old N200 notes of N5,000 over-the-counter so that everyone can have cash.

“If they had brought the new notes, we would have dispensed them  through the ATM.”

Visit to bank branches 

Vanguard MoneyDigest visits reveal that most of the bank  branches did not have cash to dispense through the ATMs and inside the banking halls, while a few others paid as little as N3,000 over-the-counter. A few others dispensed a maximum of N5,000 via the ATMs.

The situation is largely the same as when the cash crunch started at the end January with frustrated bank customers either sitting or standing dejectedly around banks’ premises in the hope of getting money.

Customers present at the banks’ branches  visited  including Access Bank, Zenith Bank and Stanbic IBTC Bank, located at Abulado, Old Ojo Road, Lagos and Ecobank branch at Abulado, Lagos-Badagry Expressway, consisted mostly of people making transfers at the banking halls and the ATMs or those that had issues with transfers made and wanted to rectify them.

It was also discovered that the banks were struggling to make transfers for their customers due to network challenges occasioned by the increased volume of transfer requests.

Of the three banks at Abulado, Old Ojo Road, only Stanbic IBTC Bank made payment across the counter while the other two neither paid across the counter nor via the ATM.

Lucky customers of Stanbic IBTC Bank, who happened to visit the bank while the cash disbursement was going on, got paid N3,000 only.

Further findings showed that Ecobank branches located at Balogun Market inside Trade Fair and Lagos-Badagry Expressway, dispensed  N5,000 only via the ATM.

However, not many customers who came around to make withdrawal were unable to do so as the ATMs stopped functioning along the line due to obstructions caused by people clustering around the machines, which made it impossible for the machines to capture the customers making withdrawal.

At the Wema Bank located at Pako Bus stop, along Lagos-Abeokuta Expressway, the bank was only able to pay N4,000 to 120 customers out of the over 200 that besieged the bank for cash. An official of the bank who addressed the customers, lamented that the branch had only N480,000 to disburse customers. 

Customers at Access Bank, GTBank and Union Bank in Surulere, Lagos told  Vanguard MoneyDigest, “You see this long queue we have been here since 7am today Friday and they said no cash yet. 

“The bank officials said  they were still expecting cash from CBN. People are not depositing any cash. So we don’t even know our fate today. They told us from 11 am they may get cash from CBN to dispense.”

Also, 60 per cent of  of the bank branches  visited in  Marina, Lagos Island,  did not dispense cash while the  remaining ones dispensed  only through the ATMs with long queues of people struggling for cash.

Some ATMs  dispensed N2,000 per  customer and N1,000 for customers of other banks while some dispensed strictly to  customers of the bank.

Customers, PoS agents speaks 

Mrs. Helen Omoriege, a customer of  Parallex Bank said: “This is wickedness. I have been here since morning hoping I could get money only to be told that the ATM dispenses only to customers of the bank.

“For over two weeks my kids have not eaten meat in their food because it is very expensive in Ajah. I just used the little money I have to buy meat at Orile hoping I will get cash when I am going home.

“I will have to visit other banks to see if their ATMs are dispensing. I wonder what time I will get home today.”

Mr.  Okoli John, another bank customer, told Vanguard MoneyDigest  that he has been to some banks’ ATMs  and they are paying only their customers. He hoped he would be successful with getting cash on getting to Fidelity Bank.

“I have been to Guaranty Trust Bank, GTB, and they are paying N3000 to  their customers and N1,000 to  non customers. I can’t wait for hours just to withdraw N1,000.

“Here, they are  paying only their customers. I have been to five banks and it is the same story. I heard they are paying in Fidelity Bank. I will try there and hope I will  get cash.”

At a GTB branch,  Amuwo Odofin area, two ATMs dispensed N10,000 new banknotes per person but only a handful of customers were able to withdraw before the cash ran out.

One of the customers, Tochukwu, said it was his second day of coming without being able to withdraw due to insufficient cash.

He stated: “Not more than 50 customers were able to withdraw on each of the days before the ATMs ran out of money.”  

Speaking to Vanguard MoneyDigest at Amuwo Odofin, Lagos, a senior citizen and  customer of FCMB,  who does not use an ATM card, lamented that she had visited the bank several times since last week but has not been able to withdraw money over-the-counter.

“They keep telling me that there is no cash available, that I should check back which I have been doing without success,” she lamented.

An Ecobank customer, who shared her experience with Vanguard MoneyDigest, said: “I have been moving around since morning to see if I can get some money. I first went to Ecobank at Balogun Market where the ATM is paying N5,000.

“We were in a queue, but, at a point, the ATM stopped working though there was still money inside. The bank’s  staff told us that the cluster of people around the machine is making it difficult for the machine to capture the face of the customer making withdrawal.

“I left that place and came here (Ecobank branch at Abulado) when I learnt that the ATM here is also paying. This machine has also developed the same problem. We are waiting for them to come and address us on what to do next.”

Expressing his frustration over the naira redesign policy and the court order that extended the use of the old notes to December, 2023, Onyeka Anieboka, a customer of Zenith Bank, questioned the rationale behind the whole exercise, saying that it failed to stop vote buying despite the hardship the policy has meted on Nigerians.

“I don’t see the need for the policy if not to make the people suffer. After all the sufferings we have been through, they are now telling us that we can still use the old notes. Okay. Where is the naira? We can’t see the money anywhere. That means things are still the same,” he said. 

SOURCE: Vanguard News Nigeria

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