The agony of frustrated Nigerians who have money in their bank accounts but cannot get cash to solve their basic needs has continued unabated as President Muhammadu Buhari and the Central Bank of Nigeria (CBN) have kept mum over the legal tender status of two old naira notes.
More than one week after the Supreme Court ruled that the old N500 and N1,000 banknotes remained legal tender until December 31, 2023, many Nigerians still continued to reject the currency notes over the weekend as they waited to hear from either Buhari or Godwin Emefiele, governor of the CBN.
Some banks complied partially with the Supreme Court’s ruling last week by dispensing the old notes to their customers.
The old naira notes were rejected mostly by traders and transporters because of the confusion caused by the silence of Buhari and Emefiele.
BusinessDay findings showed that the development has negatively affected many businesses and employees who could not go to their workplaces due to lack of cash for transport fares.
“I spend an average of three hours daily scouting several banks looking for new naira notes. These are productive hours I would have spent working,” Nathaniel Chukwu, a technician at Ketu, in Lagos, said. “Sales have dropped drastically as everyone is looking for cash.”
“The naira scarcity is frustrating and tiring. I can’t go to work or anywhere because of the scarcity. I am just stranded. I can’t afford to buy N2,000 for N600 daily for transportation costs to the office,” said Ayomide Williams, an employee with a consultancy firm on Victoria Island.
“The worst thing is that there is no end in sight until May 29 as CBN and the Presidency are quiet about the Supreme Court’s recent ruling,” she added.
Nurudeen Mohammed, a pensioner, was stranded as he could not find cash to pay his transportation fare back home after visiting a sick relative at Lagos Teaching Hospital in Ikeja, the capital of the country’s commercial city.
“I left home with N1,000 from Ikorodu, believing I will be able to get money from the bank or Point of Sale (PoS) agent to pay for my transportation back home,” he said. “I have visited several branches of First Bank across Ikeja and none is paying cash. I used PoS but all of them also do not have the cash to give.”
He said he stood for over three hours as bus drivers refused to accept online transfers for payment before someone came to his rescue.
“I am 70 years old and have been standing for over three hours now because of this naira scarcity. The bus drivers are not accepting transfers; if not for a good Samaritan, I won’t be able to go home,” he said.
Kelvin Obi, an analyst, said the lack of cash was affecting his work. “Sincerely, the naira scarcity situation is really bad. I left home with N200 to the office hoping I will get cash from the bank or PoS but couldn’t get any. The situation is hitting me hard and I can’t even concentrate on work.”
A commuter who did not want to be named said: “The continued naira scarcity has really increased the cost of living for me and the worst part is that there is no relief in sight. Getting cash is extremely difficult and if I manage to get cash, it is usually less than N5,000, and I pay a significant amount to get it. Most market men and women now accept transfer or card payment but at a cost. Last weekend, I spent over N1,000 on transfer charges alone.
“I am also forced to limit my movement due to this scarcity. What is even worse is that sometimes, I am willing to pay the cost of getting the cash but it is not available, not a single PoS machine dispenses cash around me. The situation is no longer funny and I fail to see the positive impact of this naira redesign.”
In a commercial bus on Thursday, a woman told one of our reporters that after getting to a bank by 5am, she was allowed in by 9am and realised that the bank was dispensing old notes at the counter. She said she refused to collect the banknotes because traders and bus drivers were not accepting them. She had to go to Obalende from Ajah to get cash from a friend operating a PoS terminal.
Tolu Adio, who resides in Kuje, Abuja, said she got N5,000 from a PoS agent and paid a fee of N300 but traders refused to collect the old notes from her.
“The new notes are largely unavailable as ATMs are not dispensing cash; even banks that are giving out the old notes have said they will not accept it if returned,” she said.
Read also: Business activities fall to lowest in 2yrs on naira scarcity
BusinessDay spoke with some bank officials who said they had not received any directive from the central bank. “In fact, there is confusion everywhere, even in the banking sector,” one official said.
“The entire exercise was a needless disruption of economic activities, especially among the most vulnerable segments of the economy, unfortunately,” Muda Yusuf, chief executive officer of the Centre for the Promotion of Private Enterprise, said.
He said the CBN’s currency redesign policy inflicted indescribable agony, suffering and distress on the majority of Nigerian citizens. “The trouble was not with the redesign, but the deliberate and unrestrained mopping up of cash in the economy.”
He said the CBN had mopped up about N2 trillion cash from the economy, thereby paralysing the retail sector, crippling the informal economy, stifling the agricultural value chain, immobilising the transportation sector and disrupting the payment system in the economy.
BusinessDay gathered over the weekend that the Supreme Court had served its orders in the currency redesign case on Abubakar Malami, the attorney-general of the federation.
“The President, AG Federation and Governor CBN have run out of excuses for not complying with these orders, particularly paragraphs 9 and 10 on the final page,” a source said. “These were served today. I expect the CBN to issue guidelines to banks stating that the N500 and N1,000 notes will be released and telling them to put them back into circulation. Not later than Monday. It’s straightforward. Let’s see what they do.”
