Venezuela Caps Daily Bank Withdrawals at US$5 to Avoid Bankruptcy

EspañolVenezuela has put a cap on daily bank withdrawals at VEF $10,000, or US $5.26.

The Superintendency of Banking Sector Institutions (Sudeban) ordered public and private banks to refrain from paying out more than US $ 5.26 per day in cash from offices or ATMs.

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Users have reportedly expressed frustration at trying to withdrawal money since Novemeber 15 with checks or through cashiers.

According to a statement released by Sudeban, users can make a maximum of four transactions per day to withdraw up to US $5.

The decision was made as Venezuela suffers from rampant inflation exceeding 750 percent, which has forced many citizens to handle more cash for their purchases.

Venezuelans took to social media to express their concern about the strange financial decision made by their government, calling it a “financial corralito.”

CORRALITO…Hasta Bs.10.000 en efectivo se pueden retirar de bancos y cajeros en Venezuela!

— Vanessa C. Rodríguez (@PRVanessaRR) November 17, 2016

CORRALITO… Up to 10.000 VEB can be withdrawn from banks and ATMs in Venezuela

A financial corralito is a government’s attempt to avoid bankrupting its banking system in times of economic recession, and when confidence in that system has noticeably declined. When people begin to distrust the system, they withdraw all of their savings in cash.

No Bills

The delivery of bank notes to various public and private banking agencies has reportedly fallen by an average of 50 percent in the last month.

According to sources linked to the Central Bank of Venezuela, the new banknotes will enter into circulation on December 15, but will do so through a gradual process. Two-hundred bolivar notes (USD $ 0.10) and 500 bolivars (USD $ 0.25) will be released first and then 1,000 bolivar notes (USD $ 0.50), followed by 5,000 (USD $ 2,63), 10,000 (USD $ 5,2) and 20,000 bolivares (USD $ 10.50) notes.

Source: El Nacional