Fights break out at bank ATMs, where people stand in lines for days just to withdraw around $40 at most. The cash shortage is so severe that many cannot buy food or medicine despite having money in the bank. Protesters vent their anger by burning banks.
The Nigerian government’s decision to replace its currency with newly designed banknotes in just four months – with a deadline of February 10 – has thrown Africa’s largest democracy into chaos as it heads into presidential elections scheduled for this Saturday, February 25.
Most Nigerians have used their old currency called the naira as ordered by the Central Bank of Nigeria in October. But when they tried to withdraw the new notes from banks or even informal money brokers, they were stunned to find that few were available.
The cash crunch is now a huge and unpredictable factor in the elections that have already been in Nigeria the most open race in recent years. Presidential candidates for the two major parties, which have traded power for more than two decades and failed to tackle widespread poverty and insecurity, now face surprise, third party challenger.
The government has not made it clear what it is trying to achieve by changing the currency, offering a variety of explanations, including that it is trying to curb counterfeiting and hoarding. But the effort was a disaster, and some suspect there may be a political motive behind the mess because of the timing.
Voters are now furious with the ruling party over a shortage of currency notes that could undermine support for the party candidate. If the protests continue, they could disrupt elections in some parts of the country. Voter turnout could be affected because some voters cannot afford to travel to remote polling stations.
Blessing Akor, 22, was on the verge of tears as she was jostled by dozens of people queuing for an ATM in downtown Abuja. At 4 a.m. that morning, she left her young daughter with a neighbor she didn’t trust much and went to look for money.
The heat was intense, but Mrs. Akor had little choice; although she had money in her account, she didn’t have cash for food, water or a trip home. She was seething with anger at the government and said she would not vote for any Nigerian politician.
“We’ve been through hell, serious hell,” she said, watching a man in military uniform rush into line. “It’s suffocating – like they’re squeezing my throat.”
Normally, cash is Mrs. Akor’s livelihood. Since Nigeria has few commercial bank branches and ATMs, many people get cash from professional agents who act as human ATMs, known as POS or Point of Service Operators. Ms. Akor is among scores of such operators who stand on street corners across the country with small stocks of cash and mobile card machines, offering cash to cardholders for a small fee.
Right now, however, cash is so scarce that these fees are astronomical.
Prince Chibeze (37) hid under the umbrella of a POS operator in Lagos last week and asked for a 5,000 naira withdrawal price. The construction worker, who earns around 9,000 naira a day, spent hours searching for cash to send home to his parents, who were running out of food. But each POS operator demanded 30 percent – 1,500 naira – a huge jump from the usual 100 naira fee.
Central Bank Governor Godwin Emefiele initially said the currency had to be redesigned because Nigerians were hoarding notes in their homes. Then he said it would help prevent counterfeiting and kidnappersThe ransom and that it was a step towards achieving a cashless society. He also later claimed it would reduce inflation – which had risen to a crippling 21 percent.
However, some analysts, politicians and dozens of Nigerian voters said the real reason was to stop vote buying by thwarting politicians hoarding naira ahead of election day.
President Muhammadu Buhari said this last week that it has reduced the influence of money on politics and many Nigerians agreed about the politics in interviews. But some warned that voters could be so desperate for money that they would sell their votes more easily.
President Buhari served two terms and could not run again. The ruling All Progressives Congress (APC) has selected Bola Tinubu, a former governor of Lagos, as its presidential candidate.
But one of Mr. Tinubu’s rivals in the presidential primaries was the central bank chief, Mr. Emefiele. Mr. Tinubu’s allies say the central bank and a group of people around the president are seeking revenge and plotting to ensure Mr. Tinubu suffers huge losses by stoking Nigerians’ anger at the government.
Even one APC state governor he claimed that they sought to “provide a fertile ground for a military takeover”.
Some critics have even accused President Buhari of trying to make Mr. Tinubu lose the election – allegations that Mr. Buhari, who campaigned with Mr. Tinubu, has denied.
This is the second time Mr. Buhari has rushed to redesign the currency; the first was nearly four decades ago, after he seized power in a coup d’état. then, he gave Nigerians less than two weeks exchange their naira.
It is unclear how severe the shortage of the new naira is this time around. Mr. Emefiele only vaguely mentioned “problems in distribution“from notes, blame commercial banks for not loading them into ATMs Neither he nor the president’s spokesperson could be reached for comment.
As the political fighting intensifies, the disruption to normal life is extraordinary.
Angel Christopher pulled his children out of school because he was unable to pay school fees because he sells so few vegetables to cash-strapped customers at the Garki Model Market in Abuja. Hungry diners at the lunch spot ate smaller portions of banga soup — palm fruit stew — because chef Theresa Tota can’t afford to buy so many ingredients.
A cash-strapped cattle owner in northeast Borno has sold his sheep for a fraction of the usual price. At the Ocean Blue strip club in Lagos, dancers have started accepting bank transfers. Uber drivers now routinely phone passengers before picking them up to ask if they’re paying in cash — and cancel if they’re not.
Nigerians with bank accounts are trying to pay with cards and bank transfers – but are often hampered by what they call “network issues”, possibly because the system is suddenly overloaded.
Fuel shortages added to the crisis. Lines at gas stations rival those at ATMs Some customers sleep in their vehicles to get gas and some pay double the official price. Industry officials blame the high cost of transporting fuel into and out of the country. But Nigeria is one of Africa’s largest oil producers and many citizens blame the government for mismanagement.
The long-term effects of the financial crisis on Nigeria’s already struggling economy are unclear, but when India forbidden largest rupee notes in 2016, causing similar chaotic scenesyours the economy slowed significantly.
Rituals enjoyed by many Nigerians are also affected.
At the glamorous wedding in Lagos, there were no wads of cash to shower the bride and groom with money – a Nigerian tradition.
The next morning at Citadel Church, a large Pentecostal church in Lagos, as the blue plastic buckets of offerings were passed around, the congregants imitated putting money into them. Few had notes. Church leaders anticipated this: there were rows of card machines outside the auditorium, and inside a giant screen flashed bank numbers so worshipers could transfer their tithes instead.
In his sermon, the church’s famous pastor, Tunde Bakare – who himself was the ruling party’s 2023 presidential candidate but failed to win any delegate votes in the primaries – criticized Nigerian politicians, including some from his own party.
“Today our nation is in dire straits; our leading political parties and politicians in their enclaves are at war with themselves,” he told his flock.
He said in an interview after the service that he would usually be on the ground promoting his party, APC, but that he refused to be “part of Ali Baba and 40 thieves”.
And although he was Mr. Buhari’s running mate in 2011 and remains close to the president, the pastor had no kind words for the chaotic currency change.
“The policy may be good but the implementation is terrible,” Mr Bakare said.
Oladeinde Olawoyin in Lagos and Rahila Lassa in Abuja contributed their reports.
