According to a report by The Nation, Deposit Money Banks (DMBs) in Nigeria are feeling the effects of low deposits from customers, which could limit their ability to lend and offer credit to boost production and investments.
A member of the Bankers’ Committee confirmed that banks have been threatened by the lack of interest to “return difficult-to-get cash into the banking system.” The implementation of the naira redesign policy has triggered a cash crunch, which has led many Nigerians to abandon the banking culture.
The lack of interest in depositing cash is part of the uncertainty arising from the scarcity of cash in banks, following the introduction of the cashless policy by the Central Bank of Nigeria (CBN).
The weak desire to return cash to banks is attributed to the loss of confidence in the system. This loss of confidence has caused fear that cash shortage will continue.
However, there is optimism that confidence is gradually being restored in the banks and commercial sector. The solution to this problem is for the CBN to sustain its tempo of releasing more notes, both new and old into the system. Customers will gradually regain confidence in the banking system.
The Managing Director/CEO SD&D Capital Management Limited, Mr. Gbolade Idakolo, said that the deposit is expected to decline due to the experience of depositors in the past few months.
Bank customers went through a lot of trouble to make withdrawals from their deposits, so it is natural for there to be resentment as regards depositing their funds back to the banks. This trend will be on for some months before depositors will adjust accordingly. The economy will gradually bounce back with the infusion of cash back into the system.
The staff of some commercial banks in Abuja told The Nation that deposits are coming in trickles, most come only to withdraw.
Another scenario playing out daily in the banking halls is the crowd of bank customers who besiege the customer care unit of the banks. Most of the angry customers visit the Customer Care unit to complain about one failed transaction or the other.