With banking system in shambles, cash shortages and high fees plague local economies in Arakan State

By Admin 30 Dec 2023

DMG Newsroom
30 December 2023, Sittwe

Cash is running short in many Arakan State townships as Myanmar’s military regime has imposed draconian travel restrictions since renewed fighting broke out in mid-November.

In several townships including Pauktaw, Ponnagyun, Kyauktaw, Mrauk-U and Minbya, mobile money service agents are charging customers a fee of 1 to 10 percent, and sometimes higher, for cash withdrawals from mobile wallets like KBZ Pay and Wave Pay.

“I have to give 12,000 kyats to agents to withdraw 100,000 kyats. So, if someone transfers me 500,000 kyats via KBZ Pay, I have to give 60,000 kyats to the agent to withdraw the money,” said a woman from Mrauk-U Township.

Myanmar’s military regime has blockaded roads and waterways in Arakan State since renewed hostilities broke out on November 13.

The fighting that first flared last month in northern Arakan State has spread to townships in southern Arakan State, and the banking system has largely ceased to function in townships experiencing armed conflict.

Wave Pay and KBZ Pay agents, which are part of networks linked with Yoma and KBZ banks respectively, face difficulties in providing cash-in and cash-out services.

“As banks are not operating, we can’t run smoothly,” said a mobile money agent from Minbya Township. “Roads are blockaded, and we have difficulties with depositing and withdrawing cash. We are only running the service with remaining cash on hand for the convenience of others.”

Local residents in Kyauktaw and Pauktaw townships say they are charged 10,000 to 15,000 kyats to withdraw 100,000 kyats from KBZ Pay and Wave Pay mobile wallets.

“We are thankful that they are still providing cash-out service at this difficult time,” said a woman from Pauktaw Township. “But they should not charge a high percentage at this time.”

Many businesses have suspended operations due to the junta’s travel restrictions in Arakan State, a troubling development that is expected to do more harm to the already-battered local economy.