As Nigerians grapple with the financial and economic crises caused by the change in banknotes, the Microfinance Bank, MfB, a segment of the financial market may have been marginalized in both policy framework and implementation, potentially exacerbating the crisis.
If the segment had been included in the policy framework, the operators indicated that they could have provided better options, particularly for the less privileged and grassroots financial needs.
They also claimed that by putting its operations on hold during the implementation of the new banknote policy, the sub-sector has been forced to suffer like any other ordinary Nigerian.
Mr. Akinwunmi Lawal, Managing Director of NPF Microfinance Bank Plc, told Financial Vanguard that MfBs were barred from dispensing both old and new notes at their ATMs and even over the counter, OTC.
He explained that the reason for the exclusion is that, unlike mainstream commercial banks, MfBs do not have direct access to the Central Bank of Nigeria, CBN.
Lawal described the situation as a disaster, adding that the commercial banks on which they rely are also experiencing a naira shortage.
“I don’t know how to describe the situation in which we have found ourselves, but I will tell you that it is a disaster,” he said. We don’t even have one of the new Naira notes. We are completely barred from withdrawing naira from ATMs and OTCs.
“MfBs were not considered in the plan, and so they make our representation bad to our customers and the public. When we tell customers that we don’t have any cash, either old or new naira notes, they say it’s a lie and they don’t believe us. We don’t know how to explain it to them again”.
Mrs. Clara Oloniniyi, Founder, of Infinity Microfinance Bank Limited, also spoke, saying that MfBs are the hardest hit because they do not have access to the CBN, which automatically excludes the sub-sector from meeting the expectations of their customers, the active poor.
While lamenting the impact of naira scarcity on their business, she claimed that the active poor have been mistreated as a result of the MfBs’ exclusion from the new banknote roll-out.
“We don’t have a single penny in the bank to work with,” Oloniniyi explained. We have no idea how we got here; this is extremely embarrassing and disgraceful.
“We’re feeling the heat, just like our hardworking poor customers. Some of them only deal in cash on a daily basis, and they will tell you that they cannot use an ATM card or make a transfer.
“They are grass root people, sometimes we would be begging them and forcing them to collect cards, but they will refuse because when they get to the machine, they are confused, they cannot operate except they are being assisted”.
