February 08, 2019
The Most Valuable
Information Free To All

Desperate to Dump Soon-Worthless Cash, Venezuelans Flock to Banks

By Girish Gupta (Reuters)

CARACAS, Venezuela - Lining up from dawn with backpacks and plastic bags full of cash, Venezuelans flocked to banks across the nation on Tuesday to ditch 100-bolivar bills after President Nicolas Maduro's surprise move to pull them from circulation.

Soldiers watched as people jostled in lines clutching Venezuela's largest denomination bill - now worth just 3 U.S. cents on the streets - which they have to deposit before it becomes officially worthless.

Maduro announced the measure on Sunday, to the consternation of Venezuelans who have become accustomed to stashing large volumes of cash at home as the bolivar currency's value has plunged in the crisis-hit OPEC nation.

Many businesses stopped receiving them immediately.

Accused by critics of taking a nonsensical and rushed measure, Maduro, 54, justified it as an attempt to outwit international mafias, especially on the Colombian border, hoarding bolivars for contraband.

"To the people of Venezuela, especially pensioners, drivers, business people, housewives and workers ... I tell you that you don't need to worry," said Maduro in a communique on Tuesday.

"The measures are in your interests."


Displaying images of huge piles of confiscated bills, officials say criminals have tried to sabotage Venezuela's economy - at the behest of the U.S. Treasury - by siphoning out bolivars to warehouses in Switzerland, Poland, Ukraine, Spain, Germany and the Czech Republic.

Venezuela closed its border with Colombia on Monday, where the government said 117 people had been arrested and 104 million bolivars - $27,000 at the black market rate - confiscated.

The OPEC nation is undergoing a major crisis: inflation is forecast by local economists for this year at more than 500 percent and the currency has fallen more than 75 percent in a year against the dollar - leaving millions skipping meals.

Tuesday's bank lines were akin to the now-ubiquitous scenes outside shops where food and medicines have grown scarce during Maduro's more than three-year presidency.

The bills will officially be pulled on Thursday, after which Venezuelans have 10 days to take any left to the central bank.

Many are questioning how the nation can collect more than 6 billion bills in such a short period.

"This country is chaotic and every day it gets worse. What's the point?" said Walter Castagnoli, 43, an unemployed driver with a 13-year-old son lining up to deposit a satchel full of bills at a bank in Caracas.

New higher-denomination bills are due to start being released on Thursday.

(Reporting by Girish Gupta in Caracas, Isaac Urrutia in Maracaibo and Anggy Polanco in La Parada, Venezuela; Editing by Andrew Cawthorne and Andrew Hay)

Related Posts