FX crunch: Anger, frustration as banks ration dollar among customers

Nigerian banks are now rationing forex withdrawals by customers, TheCable can report.

The economy has suffered a double blow from the COVID-19 pandemic and low oil prices, leading to little forex inflow.

Latest data from the National Bureau of Statistics (NBS) shows that proceeds from crude oil exports accounted for 72  percent of Nigeria’s forex earnings in Q2 2020.

With low oil prices, Nigeria has been earning less than it used to from crude oil export — the major reasosn for the tight forex situation.

Godwin Emefiele, governor of the Central Bank of Nigeria (CBN), has promised investors that the bank will attend to all forex demands and that the external reserves can support eight months of imports.

A customer who holds a domiciliary account with one of the leading banks in the country told TheCable on Wednesday that he has been unable to withdraw euros.

“For over three months, almost all the branches of my bank in Lagos do not have euros available for withdrawal. No explanation was given for this other than the effect of COVID-19,” he said.

A banker who also pleaded anonymity said: “As at yesterday, you can only send FX interbank to a related party (someone related to you in name)”.

A Twitter user also claimed that her bank offered her the naira equivalent of the forex in her dom account when she tried to withdraw.

“Called my account officer and he said to get my USD, I should send them an email asking for the Naira equivalent at the official exchange rate,” she wrote.

Called my account officer and he said to get my USD, I should send them an email asking for the Naira equivalent at the official exchange rate. Loool

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— Ms. Asa Nwa (Chi Baby)🏳️‍🌈 (@AfricanCeleb) September 23, 2020

An explanation provided by Oyinade Adegbite, Guaranty Trust bank’s head of corporate communications and external affairs, had previously offered some insight.

“Remember that we don’t sell dollars, yet we have to manage both people who have inflows and want cash as well as customers who deposit cash and want cash,” Adegbite told TheCable in July.

“We sometimes experience a situation where there is a lot of inflows and customers wanting to withdraw cash thus putting pressure on the liquidity. And we have to give everybody something.

“We don’t want a situation where customers come in and we can’t even meet part of their demand.

“In some cases, we pool from other branches to meet that demand but that also comes with a waiting period because we can’t anticipate how much FX demand we’ll get.”

Banks have already reduced the dollar spending limit on naira debit cards with some setting the limit as low as $50 per month.

TheCable reported that transfers between customers who own domiciliary accounts are now prohibited.