Nigeria’s Cash Shortage Crisis Deepens As Reps Pressure CBN For Urgent Response

Nigeria’s Cash Shortage Crisis Deepens As Reps Pressure CBN For Urgent Response

The House of Representatives has raised alarm over the escalating cash shortage in commercial banks, calling on the Central Bank of Nigeria (CBN) to urgently address the issue. This shortage has severely disrupted economic activities, leaving millions of Nigerians struggling…READ MORE…

to access funds for daily necessities.

The call comes after Vice President Kashim Shettima directed both the CBN and commercial banks to swiftly resolve the issue of cash scarcity and the increasing arbitrary charges imposed by Point-of-Sale (POS) operators.

In response, the CBN issued a directive last week mandating Deposit Money Banks (DMBs) to prioritize cash disbursement, both over the counter and through Automated Teller Machines (ATMs). The policy, which took effect on December 1, 2024, aims to address the nationwide shortage and improve currency circulation.

During a motion raised by Hon. Uguru Emmanuel, the House highlighted the severe economic and social consequences of the cash crunch, with many Nigerians unable to access basic funds. Hon. Emmanuel stressed that the persistent cash shortage has stifled economic growth, as consumer spending and business investment have both plummeted.

The lawmaker also criticized commercial banks for flouting the CBN’s policy from December 2022, which set cash withdrawal limits at N500,000 for individuals and N5 million for corporate bodies. Banks have, in many cases, restricted withdrawals to as little as N10,000.

Emmanuel further raised concerns over the soaring charges by POS operators, who are reportedly able to access cash in larger quantities and charge exorbitant fees. “This is an unacceptable situation, especially as we approach the holiday season,” he said, urging the CBN to take swift action.

In its resolution, the House of Representatives instructed the Committee on Banking Regulations to investigate the matter and report within a week, while also directing the CBN to urgently resolve the situation.

Meanwhile, Nigerians in both urban and rural areas continue to face immense challenges in accessing cash. In rural communities, where banking facilities are limited, the situation is even more severe. In cities, POS operators have been charging customers high fees to access cash. Jennifer Samuel, a civil servant, shared her frustration: “I had to pay N500 just to withdraw N10,000 at Jabi Park. It’s unfair.”

Abdulmumini Ibrahim, a businessman, also recounted paying N800 to a POS operator for N20,000. He stressed the need for the government to invest in infrastructure to support a cashless society, as Nigeria is not yet ready for such a transition.

CBN Imposes Hefty Fines on Leading Fintech Firms Amid Regulatory Scrutiny

In a move signaling increased oversight, the Central Bank of Nigeria (CBN) has slapped heavy fines on two of the country’s leading fintech giants, Moniepoint and OPay, each fined N1 billion in Q2 of 2024. Several other fintech firms were also penalized after a routine audit revealed significant compliance issues.

These fines come amid growing concerns over the rapidly expanding fintech sector, with companies like OPay, which boasts around 40 million users, and Moniepoint, processing billions in transactions, now under greater scrutiny.

Sources familiar with the matter confirmed that at least four other fintech companies were also penalized, though details of their fines remain unclear. While OPay denied the allegations, calling them “entirely false,” reports from insiders indicate that Moniepoint has indeed been fined, though the exact amount remains uncertain.

The fines come as part of the CBN’s effort to enforce compliance in the fintech sector, particularly with regard to Know Your Customer (KYC) standards. In April 2024, the CBN imposed a two-month ban on customer onboarding for several fintech companies, citing failures to meet KYC requirements.

With fintech companies now playing a significant role in Nigeria’s economy, the CBN is increasingly focused on ensuring that they adhere to regulatory standards, as the sector grows rapidly alongside the country’s digital economy.

For More Information And News Update, Join Ireporteronline WhatsApp Channel With Link Below: https://whatsapp.com/channel/0029VaV4jB6DuMRgwqnJCF32 For advertisement inquiries only, kindly send a message to 09010649814 on Whatsapp