How Nigerians are dealing with hard times as fuel and Naira notes crisis bites
In over three months, Nigerians have been seeing rising and worrying levels of hardship with scarcity of fuel and the new Naira notes crisis.
In some parts of the country, fuel now sells for N300/litre against the official N165 and N185 – the new official pump price activated by oil marketers in January 2023. The oil marketers claimed the new pump price was approved by the Federal Government to encourage marketers to open up for business but the Minister of State for Petroleum Resources, Timipre Sylva, denied the claim.
The Major Oil Marketers Association of Nigeria (MOMAN) also said the high costs of vessels and inadequate trucks to deliver petroleum products from depots to filling stations nationwide are responsible for the fuel crisis.
While Nigerians are still struggling with fuel crisis, the deadline set by the Central Bank of Nigeria (CBN) for the swap of old Naira notes for new notes is also contributing to hard times.
In November 2022, the CBN announced plans to redesign the ₦200, ₦500 and ₦1000 notes and said the Naira redesign is aimed at driving cashless policy, mop up excess cash in circulation and also combat banditry and ransom taking.
The CBN released the redesigned ₦200, ₦500 and ₦1000 in December 2022 and set January 31, 2023, as deadline for the use of the old notes. The deadline sent panic across the country as many Nigerians thronged banks throughout the days of the week seeking to swap their old notes for the new notes before the deadline set by the CBN.
“As at October 2022, currency in circulation had risen to ₦3.23 trillion; out of which only ₦500 billion was within the Banking Industry and ₦2.7 trillion held permanently in people’s homes… So far and since the commencement of this programme, we have collected about ₦1.9 trillion; leaving us with about ₦900 billion (₦500b + ₦1.9triIIion),” Emefiele said in a statement on Sunday, announcing an extension of the deadline to February 10, 2023.
The extension of the deadline appears to have had little impact in reducing the pressure and panic among Nigerians following widespread reports claiming banking transactions are failing on alternative channels – internet banking, mobile banking apps, USSD and POS.
In more than 10 tweets examined by Neusroom, Nigerians are lamenting their inability to use these channels while trying to make payments for services. Some Nigerians also said they could not withdraw more than N1000 at ATMs in some parts of the country.
Oluwadara Oluwatoye, a radio presenter in Lagos, who shared her experience with Neusroom, said customers are only allowed to withdraw N1000 at the ATMs of some commercial banks in Lagos.
“I was in Gbagada environs, and we went from ATM to ATM with none having cash. We checked Access Bank, First Bank, UBA. Still nothing. We went into the UBA to get over the counter and one of the cashier attendants told us that we could only get N1000. (I’m going to assume they were instructed to only give 1000 max to anyone who wanted to get over the counter),” she said.
“We got to Zenith Bank and there was a long queue at the ATM which was dispensing cash. But they said if your card wasn’t a Zenith Bank card, you were only allowed to withdraw 1,000. And this queue was really long. So, we left because we can’t queue for that long under the hot sun just to get N1,000.”
Sanusi Dantata, a Nigerian businessman, in a series of tweets narrating his experience, said on his arrival at the Lagos Airport, his ATM cards refused to work due to ‘Network Problems’. “Same with a friend’s card! We had to use cash! In the evening, we ordered food, cards refused to work, we made transfer, waited 30 mins for the restaurant to see their alert!” he tweeted.
Came to Lagos Yesterday, right from the airport, my ATM cards refused to work due to “Network Problems.” Same with a friend’s card! We had to use cash! In the evening, we ordered food, cards refused to work, we made transfer, waited 30 mins for the restaurant to see their alert!
— Sanusi Dantata (@SasDantata) January 31, 2023
Dr Joe Abah, a former director general in the Nigerian public service also shared his experience with using alternative channels for banking transactions. “I wanted to send my driver to buy something but no cash in ATMs, no POS vendors, transfers to his account didn’t deliver for 12 hours,” he tweeted.
The failure of alternative banking channels and inadequate funds in ATMs in some parts of the country is forcing businesses to demand only cash (new Naira notes) from customers. While citizens are complaining about their inability to access the new Naira notes, there have been multiple videos circulating on the internet of party attendees spraying bundles of the new Naira notes at parties.
Emefiele, the CBN Governor, has blamed banks for the scarcity of new Naira notes.
“They (banks) were told to load this currency into the ATM. The ATM is a robot. People can only collect a maximum of N20,000 or N40,000, whether they are priority or not a priority customer,” Emefiele said when he appeared before the House of Representatives Adhoc Committee on the New Naira Redesign.
“Many of us have unfortunately seen the new naira, instead of being used for the purpose it’s meant, is used in parties, in celebrations.”
A banker with one of Nigeria’s leading commercial banks told Neusroom that the shortage of new Naira notes is affecting operations at his branch and also affecting customers.
“I pity the customers more, because as it is, they don’t have access to the new and old notes,” said the banker who does not want to be mentioned. “They (customers) don’t believe commercial banks don’t have sufficient (funds) to cater for the ATMs. They think we are hoarding it.”
What Nigerians are reduced to for Naira notes. After facing this, #fuelscarcity wahala is next for the day. Useless is not trending for nothing. pic.twitter.com/QcZubmDhXU
— Oyibo of Abuja (@oyiboediri) January 31, 2023
Asked about the claims by the CBN that there are enough new Naira notes allocated to banks to address the needs of customers, the banker said he could not confirm the authenticity of the claim. He, however, alleged that the source of the shortage of funds can be traced to the head offices of the commercial banks where the funds are distributed to branches.
“Imagine receiving N2.5m as a branch? That can’t even fill up one ATM,” he said.
This crisis is making it difficult for Nigerians to keep their heads above choppy financial waters. Multiple videos have also emerged on the internet of Nigerians fighting at filling stations, banks and ATM terminals as they struggle to get fuel and the new Naira notes.
What’s the government doing?
President Muhammadu Buhari who also doubles as Petroleum Minister appears not to be bothered as he prepares for his exit on May 29. A 14-member committee set up on January 24, 2023, and chaired by Buhari to address the fuel crisis is yet to find a solution.
The ultimatum given in December 2022 by the Department of State Service (DSS) to the NNPC and other stakeholders in the downstream sector to end the fuel scarcity across the country in 48 hours has not ended the crisis in some parts of the country, especially in Lagos, the country’s commercial centre.
Meanwhile, Emefiele, on Tuesday, January 31, 2023, said old Naira notes can still be deposited after the extended deadline.
Emefiele told lawmakers at the House of Representatives that the Economic and Financial Crimes Commission (EFCC), the Independent Corrupt Practices and other Related Offences Commission (ICPC), the Nigerian Financial Intelligence Unit (NFIU) and the Department of State Services (DSS) have been directed to go after banks violating the issuance of the Naira notes.
What’s the implication of the crisis?
As Nigeria prepares for the 2023 election, the Independent National Electoral Commission (INEC), on Tuesday, January 31, 2023, said fuel scarcity may affect the movement of election materials and election personnel.
Some Nigerians told Neusroom that the fuel and Naira notes crisis may also influence their decision in the 2023 election.
Tosin Olujuyitan told Neusroom that the APC government is supposed to use this period to sell itself to Nigeria, but it is not doing so and so this current fuel scarcity will affect their chances at the poll.
Precious said some people’s polling unit is far so with fuel scarcity, it will be difficult for them to make arrangement to go and vote.
