*Experts have attributed the current cash crunch in the economy amid seasonal celebrations to the Central Bank of Nigeria’s Naira redesign that has ended up as ‘a colossal fiasco’, and聽 subjected millions of consumers to untold hardships amid high inflation in the West African country

Isola Moses | 绿帽献妻

This year’s Christmas festivities, and New Year celebrations are coming on a low key for several Nigerian consumers, as the high costs of living have worsened over the unavailability of cash in banks, other financial institutions, as well as Pint of Sale (PoS) terminals in the country.

All these have negatively impacted the many Nigerians’ ability to embark on spending spree, according to report.

绿帽献妻 reports the headline inflation, which was at 21.82 percent, at the beginning of the year, has so far risen to 28.2 percent as of聽 November 2023.

Nigerian banknotes

This indicates that the rate at which prices of goods and services are rising is faster than it used to be in recent times.

The situation for several consumers is worsened by the lack of cash in the financial system as banks were unable to give out cash to their customers and Automatic Teller Machines (ATMs) across the country remained dry, especially a few days to this year’s Christmas, according to reports.

In some banking halls last Friday before Christmas, there was an indication, that several banks were not dispensing cash, just as some financial institutions dispensing cash were paying between a maximum of N20,000 and N5,000 to their customers, report stated.

It was also observed that a few ATMs that were dispensing limited the ability to withdraw more than N20,000 whereas some dispensed up to N40,000.

Banks had earlier limited daily withdrawal limits to N40,000 to stem the demand for cash.

A shopper at the Balogun Market on Lagos Island, in Lagos State, said she was not sure she would be able to buy new Christmas outfit for her kids and the celebration would have to be low key as everything has become so expensive in the economy.

“Everything is so expensive and even when you want to struggle and buy, the traders are refusing to accept bank transfers.

“I have been going from ATM to ATM to get cash but I cant get enough to pay for what I want to buy. “I also cannot afford to pay the high charges that PoS operators are charging. It is looking like I will go back home,” she was quoted to have聽 lamented while in a queue at the ATM point in Lagos.

Mrs. Salako a septuagenarian and retired teacher, said she had to beg the bank manager that she needed to buy foodstuffs before she could get N5,000 cash which she said was paid in dirty N100 notes.

She lamented that “it is still better than paying money to collect my money and not having cash at all.”

Commenting on the cash scarcity situation also, Yemisi Salaudeen said she concluded her Christmas shopping November 2023, as procrastination until the peak period when prices skyrocket was not a viable alternative due to the alarming hikes in prices of food items in Nigeria.

Salaudeen said: “Furthermore, cash accessibility presents a hurdle, given the constraints on withdrawal limits.”

Telling effects of inflationary trend on consumers

It was learnt the lack of cash had worsened the rising the costs of items, as several consumers now ready seek alternatives to the traditional celebrations.

John a clothes trader at the Gatankowa Market, in Abule Egba area of Lagos popular for used imported clothes, noted that there are more people visiting the market.

He said: “To buy new materials and sow is very expensive and new imported clothes are also expensive so people find alternative in cheaper used clothes.”

With food inflation rising to 32.84 percent in November from 31.52 per cent in October, many Nigerians are also facing a hard time celebrating the year end festivities in grand style.

The chicken, which is a major player during this season has risen from about N10,000 in done locations prior to the festive season to above N20,000 in some markets.

Also, the price of beef had risen form N2,800 a month ago to N3,300 per kilo, report noted.

George Oluwaseun, a civil servant, in October this year, had reportedly disclosed that she bought just over N15,000 for 10 chocolate beverages which currently sold between N17,500 and N18,000.

A five-litre container of groundnut oil used to cost N7,500 but now ranges from N9,000 to N10,000.

A derica of beans previously sold for between N500 and N600 is now being sold at prices ranging from as high as N800-N900.

The price of good rice fluctuates; the staple food item can cost anywhere from between N55,000 and N80,000 depending on the vendor.

A crate of eggs that once sold at N2,200 is currently valued somewhere in the range of about N3,000 and N3,200, according to market report.

Likewise, a carton of soap sold for only about N6,000, is now sold for N8,400 or even up to N8,000 nowadays.

Even some popular toothpaste brands prices previously sold for about N500 and N600 are now being sold at retail prices ranging from a minimum of about N800 to N1000.

At a barbershop, the barber explained the extent to which he went to get cheaper rice.

He said, “Rice is expensive these days. A bag is sold for between N60,000 and N75,000.

“A few days ago, we went as far as the border in Idiroko, Ogun State, to buy good rice. Our budget for a half bag of rice is N16,000.

“We went there and ended up buying it for N28,000. This shows that our government want to kill us. Half a bag of rice, N28,000? Jesus, na your hand, we dey o.”

The consumer also said: “And the surprising thing is that nobody is talking again.

“Nigeria is dormant, and the few people who are talking, they have used money to blind them from speaking the truth.”

Grace Margaret said a crate of tomatoes now costs her N8,000 compared to last year’s N5,000.

Unfortunately, this trend continues each year with no signs of abating. The people who are in the food business are the ones suffering most from this. “They buy pepper, they buy condiments to prepare the food, and after selling, they do not make their money back.

Why Naira scarcity resurfaces in Nigeria -CACOL

In its reaction to the current high inflation in the Nigerian economy, the Centre for Anti-Corruption and Open Leadership (CACOL) decried the Naira scarcity being witnessed in various parts of the country.

Tola Oresanwo, Director of Administration and Programmes at CACOL, in a statement said: “We have observed that barely a year after the Central Bank of Nigeria Naira redesign that ended up as a colossal fiasco and subjected our people to untold hardships, Naira scarcity has resurfaced in the country.

“It was reported that since last month, banks started imposing daily individual withdrawal limits of between N20,000 to N40,000 which was mainly due to the shortage of cash in their vaults.

“Alhough the Central Bank has tried to assuage the apprehension of the people by repeatedly assuring the people that it had supplied the banks with enough cash but the situation is yet to improve.”

The organisation stated: “As we speak now, you cannot withdraw more than N10,000 in some banks, this is not a good time for this anomaly as we are approaching the festive season when majority of our people who rely on cash transactions would likely demand for more cash to facilitate their various transactions.

“The Federal Government and the Central Bank of Nigeria should critically look into what may have been responsible for the current Naira scarcity and nip it in the bud as soon as possible.

“It is a known fact that the mobile and online transactions are still plagued with numerous challenges that makes some Nigerians not to adopt it.”

CACOL also noted: “The fact that a vast majority of the people in the hinterlands who don’t have access to the Internet and or electricity may only find solace in cash transactions is another factor why we cannot afford to subject them to another round of wild goose chase of a commodity that ought to be readily available whenever it is needed.”

Farouk Gumel, Chairman of Union Bank, Farouk Gumel, speaking at a recent event organised by Singapore-based NTU-Centre, with the theme, “Back to Growth: Priority Agenda for the Economic Revitalisation of Nigeria,” disclosed that, inefficiency in the transportation system of the country is a major cause of food inflation.

Gumel stated: “When there is a good transportation system and a good road network, the high food inflation rate will come down.”

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