Cash Crunch in Banks will Cause More Deaths, Hunger, Afe Babalola Warns
Victor Ogunje in Ado Ekiti
A legal icon, Chief Afe Babalola(SAN) has described the cash crunch hitting some banks as another policy by the Central Bank of Nigeria (CBN) and commercial banks that would increase the sufferings of the Nigerian masses, thereby causing more deaths and hunger in the system.
Babalola said a situation whereby many Nigerians could not have access to cash in banks for Christmas and New Year celebrations had further brought negative perceptions about governments, which he said was not good for its image.
The legal luminary therefore, called on the federal government to critically look into the situation of scarcity of cash in banks in the country, warning that if it is not effectively tackled, it will lead to serious hunger, which can dovetail to high mortality rate, uncontrolled crimes and increased insecurity.
Babalola in a statement in Ado Ekiti yesterday by the Director, Corporate Services, Afe Babalola University, Tunde Olofintila, said such policy further signposted that Nigeria is backward and not making headway.
The ABUAD’s founder, said : “In recent time, the CBN and commercial banks have inflicted cash crunch on banks customers in the country. The cash crunch was felt virtually throughout the country.
Many banks had turned customers back for lack of cash while those who had the misfortune of gaining entrance into the banking Halls went home disappointed.
“Customers could not withdraw cash from the ATM machines in my university. The banks operating in the University also had no cash to pay to customers.”
The saving grace was that the students who rely on ATM machines were on holiday.
“Nigeria used to be a developing country but in the past few years, what we experience is backward development. Time it was that our economy was basically trade by barter. Gradually, traders exchanged goods for cash. Now most Nigerians earn their living from daily sales.
“These include market women, transporters, hawkers, vulcanizers, plumbers, roadside mechanics, hair dressers and so on. In the absence of sales through cash, these large proportion of Nigerians suffer more than the few wealthy Nigerians by the cash crunch imposed by the Central Bank and the Commercial Banks.
“The popular African adage is that “when hunger is eliminated from one’s problems, the remaining problems become easier to solve.” A man without cash will certainly go without food. He becomes hungry. Of course, a hungry man becomes an angry man and an angry man becomes violent. A violent man can kill, behave irrationally and even commit suicide.”
Babalola added that COVID-19 was regarded as a dangerous and a dreaded epidemic which kills its victims, but said that problem of cash crunch would kill faster than COVID-19. According to study by Johns Hopkins “every minute, hunger kills 11 people compared to seven COVID-19 deaths.”
“Hungry families also resort to desperate measures such as sale of babies, child marriage, banditry and kidnapping in order to secure food for the family.
According to Luiz Inacio Lula da Silva, President of Brazil, “Hunger is actually the worst weapon of mass destruction. It claims millions of victims each year.”
“This corroborates the statement by George McGovern that “Pay attention to the hungry, both in this country and around the world. Pay attention to the poor. Pay attention to our responsibilities for world peace. We are our brother’s keeper…” .
“Some might say that in the developed countries, much cash would not be in high demand because of cashless payment policy. Yes, it only works because their governments have created enabling environment for such technology to thrive.
“In the Nigerian context, a country that prides herself in much of analogue platforms that cannot transmit election results because 301 out of her 774 Local Government Areas (LGAs) could not have access to internet can therefore not effectively run a cashless environment needless to successfully implement the so called “Naija e-wallet”.
“Even if the motive is to fully implement a cashless payment policy, then a robust change management policy must have been put in place that will not inflict hardship on the masses. Although cashless payments are becoming increasingly common, the demand for cash is rising in many advanced economies.
“Cash is useful for payment and for other transactions. It is favoured by the elderly and marginalised, low-income people. Cash becomes especially useful when natural disasters cause power shortages and destroys computers. Cash is the safest of payment and financial instruments for the public in under developed countries like Nigeria”.