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Cash crunch: Traders, customers devise new strategies in Lagos markets

Traders and their customers across Lagos State, Nigeria’s commercial nerve centre, are still groaning as scarcity of cash remains a huge challenge in the country. Earlier reports had suggested that the cash crunch being experienced across the country had crashed prices of goods and services, but a survey by Sunday Sun in the just concluded week put a lie to the claim.

This notwithstanding, like every other challenge in the country, Nigerians, being very resilient people, are devising means of coping with the daunting challenge

Traders and their customers in most parts of the state said that the poor mobile banking services occasioned by system glitches on most banks’ platforms, exorbitant charges by Point of Sales (POS) operators, skeletal services being rendered by banks have combined to further worsen the liquidity crisis, leaving most traders and consumers more stranded and frustrated.

Many consumers who spoke to Sunday Sun lamented their frustration at procuring goods and services they intended to buy owning to lack of cash and the challenges associated with other payment options. Traders on the other hand complained that the scarcity of cash had slowed down their businesses in the last few weeks as non-availability of cash continued to pose a huge challenge to business transactions.

A house wife, Mrs Latifat Oseni while narrating her frustration about the situation told Sunday Sun how she made two different mobile transfers with service charges without the seller’s account getting credited.

The development, she said, left her embarrassed and completely clueless as to what to do next for almost an hour.

The mother of three said that she had gone to a rice dealer’s shop in the neighborhood to buy a quarter bag of rice, but left the shop frustrated.

According to her, “on Monday, I went to my customer’s shop to buy rice for my family. I had asked for the price earlier on Sunday and I was told a bag of rice was N33, 500, which means a plastic (of rice), that is quarter of bag should sell for N8, 375, but I was told to add a surcharge of N1,000 being the anticipated POS charges. I asked the boy why I had to pay N9, 375 instead of the normal price and he explained to me that was his principal’s instruction.

“So, I called his principal on phone and after much bargaining he conceded that I should pay N9,000.”

Mrs Oseni said that she attempted to use her mobile app for the transfer, but the banking app would not respond. After making several attempts without success she resorted to using codes.

“As I dialed the code, the prompts popped up and I followed it accordingly. At the final stage, I observed that the cursor rolled for a long time before it stopped. I didn’t receive a debt alert neither did I receive any notification that the transaction was successful. After some minutes, I asked the boy to confirm if his boss had received a credit alert, but I was told he hadn’t received any alert. Having waited for some minutes more without any sign that he saw the alert, I made another attempt and this time around it was successful and the debit alert came shortly which I showed the boy. The boy called his principal who claimed he was yet to receive the alert.

“He, however, instructed the boy to release the item if I could show him the debit alert on my phone, this was after wasting over an hour. When my mobile app finally came up, I discovered that I had been debited twice, but the man who owns the shop could only confirm that he was only credited with one of the two payments. As I speak to you now, my bank is yet to reverse the transaction,” she said.

The situation is more challenging and costlier in transactions involving buyers who do not operate bank accounts as many intending customers claimed they are being compelled to make POS withdrawals with exorbitant service charges before being able to buy whatever they needed.

Mrs Christiana Nwaogbo, a trader at Lawanson Market, belongs to this category of traders.

“I don’t have bank account so it is either you pay with cash or you go somewhere else to buy whatever you want to buy. It is the cash I collect from my customers that I take to Oyingbo Market to buy my goods that is why I collect cash because I don’t have account and I don’t know how to do transfer,” she said.

High charges by POS operators have shot up prices of goods and services to the rooftops with many customers lamenting the frustration they encountered before being able to carry out transactions.

Another resident of Lagos, who simply gave her name as Nkechi told Sunday Sun how she ended up paying N3, 000 for N 2,500 worth of frozen foods.

According to her, “the seller agreed to sell it for N2,500, but since she claimed not to have a bank account. I was left with no choice, but to withdraw the money from a POS operator who charged N500 commission. So, at the end of the day, I ended up paying N3,000 for an item that ordinarily should cost N2500.”

At Mile 12 Market, findings by Sunday Sun showed that most traders now have their personal POS machines in order to salvage the situation.

Alhaji Abdul, who is one of the major yam sellers, said: “The moment I noticed the cash crisis, I quickly went to my bank and requested for a POS machine and learnt how to operate it immediately. I paid N25,000 to get one, but I learnt it is N40,000 to get it now. But then, not all customers are familiar with ‘Automated Teller Machine’ Cards. Some of my loyal customers, I have given them goods on credit to return my money within one week. Some have lived up to expectation while some have not, but we keep going.”

Alhaji who spoke on behalf of the group said that in order to avoid losing their customers who do not have cash to their competitors in the market, the group jointly engaged a POS operator who helps them with cashless transactions.

“We engaged this girl who is a POS operator to stay around us since their own business is not doing fine for now. She helps collect money from our customers who do not have cash. When a customer buys meat, he or she will make payment to her with ATM card, and she would write out our names and record our various sales and payments for the day. At the end of the day, she would calculate it individually and transfer to our customers at abattoir for the next day’s business. What it means is that the next day, I would go straight to my customer at the the abattoir and carry my meat. It has been a difficult situation because, if you have cash and do not like what your customer is giving you, you can take a walk to another seller. This is how we have been coping, it has not been the best, but what can we do? It does not mean that we do not see cash at all, there are some customers who buy with cash which might be up to N5,000 to N6,000. Within the market too, we can buy things on credit and sort out ourselves later. That is how we have been operating,” he explained.

Chuks, a major food stuff seller, says his modus operandi is to tell his customers to transfer money into his Access or UBA bank accounts, which are boldly written in front of his shop. But the caveat is that you must stand with me until I get the alert, otherwise you will not leave with my goods. “I took that decision because there have been so many irregularities in the process of transactions. It has not been an easy option because of default from either the bank network or personal error,” he said.

For petty traders at Iyanna-Ejigbo market, Sunday Sun gathered that the leadership of the market had provided POS machines at the various lines in the market and when customers buy their goods from two to three sellers they will make their payments collectively to the POS operators with service charges.

Customers at the market told Sunday Sun that the POS operators charged relatively low service charges.

“It is better to pay at POS and pay a service fee of N200 instead of buying N10,000 and pay a service fee of N3,000,” a customer at the market enthused