Many Automated Teller Machines (ATMs) in Lagos failed to dispense cash on Wednesday, leaving commuters cashless for simple transactions such as transportation.
Several ATMs connected to banks in Apapa, Nigeria’s port city, were not dispensing naira notes, leaving customers stranded. According to our correspondents, bank ATMs in other parts of Lagos, Nigeria’s commercial capital, were also not dispensing cash.
This comes just one week before the Central Bank of Nigeria (CBN) deadline of January 31 to replace the country’s high-value currency notes in order to mop up excess cash, make monetary policy more effective, and tame inflation.
The CBN stated that the maximum cash withdrawal per week via ATM shall be N100,000, subject to a daily limit of N20,000, and that only N200 and lower denominations shall be loaded into the ATMs.
Nigerians are suffering as a result of the new policy, as they are unable to obtain the new notes due to scarcity. The CBN governor, Godwin Emefiele, said at the Monetary Policy Committee (MPC) meeting on Tuesday that the move was helping to reduce rising insecurity.
Despite complaints about a lack of new notes, he said there was no going back on the January 31 deadline.
Esther Igwe, a commuter who works in Apapa, visited GTB, Keystone, and Zenith Bank ATMs in Liverpool Apapa, Lagos, but none of them had any cash.
Daniel Adeyemo, a resident of Lagos’ Kosofe Local Government Area, told one of our correspondents that he went to four banks on CMD Road on Wednesday morning but none of the ATMs were working.
Some commuters expressed their displeasure, claiming that it had become a pattern since the deadline was set.
Ibrahim Adeniyi, who lives on the island, said he has been unable to withdraw cash since Monday, leaving him stranded due to a lack of funds for transportation.
“I don’t have cash to go home; I had to look for someone who had cash so that I could make a transfer to get home; even that was difficult because people aren’t willing to part with their new naira notes,” Adeniyi explained.
After ATMs failed to provide cash, some commuters were forced to rely on Point of Sale (POS) agents.
“Because I couldn’t use the ATM, I had to withdraw using the POS and pay POS charges for old naira notes,” said Atinke Adeboye, a worker.
Following the Central Bank of Nigeria’s decision to redesign some notes, money in circulation in Nigeria fell for the first time in a pre-election year since 1998, confirming the scarcity of cash in Africa’s largest economy.
According to CBN data, the amount of cash in circulation in the economy fell 4% to N3.16 trillion in November from the previous month.
Some Nigerians have resorted to stockpiling the new naira notes in preparation for the deadline, which is in less than a week.
Matthew Oladipupo, a trader, is spending his money carefully.
“I’m being prudent with the cash I have on hand because I don’t want to be stranded because I can’t withdraw money,” Oladipupo explained.
Damilola Ajagbe, a worker, said she had to wait over an hour at an ATM in Ketu because she didn’t have enough cash to get to work.
“I spent over an hour at the ATM this morning because I hadn’t been able to withdraw for a day and I needed money to get to work,” Ajagbe explained.
The current fuel shortage has continued to bite, resulting in a downward spiral as commuters complain about the increase in transportation fares.
Another commuter, Kehinde Oladele, said he waited for his boss so he could follow him and avoid being stranded.
“I waited for my boss to give me a ride to save money because transportation is expensive and I can’t withdraw money,” Oladele explained.
Some Nigerians who were able to withdraw the new notes from ATMs told BusinessDay that they would avoid transacting with them before the old notes expired.
“I drew N20,000 and have no plans to spend it before the deadline,” an ATM user explained.
Fidelity Bank informed its customers via email that the CBN has increased the daily cash withdrawal limit on ATMs from N100,000 to N20,0000, effective January 23, 2023.
“Please be informed that the CBN has revised its daily cash withdrawal limit on ATM from N100,000 to N20,0000 effective January 23rd 2023. This means that you will only be able to withdraw a total of 20,000 from your account from any ATM, regardless of bank,” it said.
Also see: Naira redesign: CBN declares new era cashless
Previously announced on December 6, 2022, the maximum cash withdrawal over the counter by individuals and corporate organizations per week was N100,000 and N500,000, respectively. The CBN, on the other hand, revised the cash withdrawal limits, which went into effect on January 9, 2023.
Individuals and corporate entities can now withdraw a maximum of N500,000 and N5 million over the counter, respectively, and withdrawals above these limits will now incur processing fees of 3% and 5%, respectively. Third-party cheques worth more than N100,000 will no longer be eligible for payment over the counter, while existing limits of N10,000,000 on clearing cheques will remain.
The cash withdrawal limits were implemented following the redesign of the N200, 500, and N1,000 notes. On December 15, 2022, the new notes were introduced into the economy, while commercial banks were instructed to return existing denominations.
President Muhammad Buhari has stated that the time frame provided is adequate for exchanging old notes for new naira notes, and there will be no going back.