Breaking News
Ad-Free Version. Upgrade your experience. Save up to 40% More details

Running out of dollars, Afghan banks ask Taliban for more cash

ForexSep 15, 2021 09:17AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
© Reuters. FILE PHOTO: An Afghan man counts his money after the Afghan currency faced devaluation in Kabul, Afghanistan, September 4, 2021. WANA (West Asia News Agency) via REUTERS

By John O'Donnell and Rupam Jain

FRANKFURT/MUMBAI (Reuters) - Afghanistan's banks are running out of dollars, and may have to close their doors to customers unless the Taliban government releases funds soon, three people with direct knowledge of the matter said.

The cash squeeze threatens to upend the country's already battered economy, largely dependent on hundreds of millions of dollars shipped by the United States to the central bank in Kabul that make their way to Afghans through banks.

One month since the Taliban captured the capital of Kabul, bankers fear fewer dollars could inflate the cost of food or electricity and make it harder to afford imports, spelling further misery for Afghans.

Although the cash crunch has lasted weeks, the country's banks have in recent days repeatedly underlined their concerns to the new government and central bank, two of the people said.

Banks have already pared back services and imposed weekly $200 payout limits amid a run on savings, with long queues outside branches as people try to get hold of dollars.

The hobbling of the central bank, whose foreign reserves were frozen after the Taliban took charge, could also hamper efforts of the international community to support Afghans.

Commercial banks have appealed to the central bank in recent days to free up the supply of U.S. dollars.

But they have yet to get an answer to their requests and are concerned that the government's vaults, in the presidential palace and headquarters of the central bank, are so empty that it may be in little position to help.

"We are left with liquidity of a few days' payments only," said one of the people with direct knowledge of the matter. "If the government does not react to the situation immediately, there will be demonstrations and violence."

In a statement on its website on Wednesday, the central bank's acting governor said banks were stable.

"The banks are completely secure," he said, adding that commercial banks usually kept 10% of their capital as cash and that those in Afghanistan, on average, held 50% as cash.

The central bank did, however, urge Afghans to use the local currency. It also posted a photograph of cash it said was part of a haul of millions of dollars and gold bars retrieved from former government officials.


Senior international officials who were overseeing the Afghan economy painted a bleaker picture in a confidential report written in recent days and sent to aid agencies.

"The liquidity crisis ... has disrupted supply chains and halted flow of money and goods," said the officials in the report seen by Reuters, warning that the economy could shrink by a third if the banking crisis was mishandled.

"A lot of businesses ... are unable to pay ... suppliers, and a lot of traders are unable to make international payments ... to import food. NGOs ... are unable to pay their staff salaries."

It is, however, unclear how much cash the government has to release. "The Taliban inherited a central bank with depleted USD and AFN cash reserves," the report said.

Some banks were taken aback when the central bank appeared to be short of dollars around the time of the fall of Kabul, because they had understood it had substantial dollar reserves in its vaults, three of the sources Reuters spoke to said.

The speed of the Taliban's victory, hastened by the final withdrawal of foreign troops from the country, took even them by surprise and compromised the chances of a smooth transition.

Ajmal Ahmadi, the previous central bank governor who fled the country, said earlier that almost all of central bank's roughly $10 billion were held abroad. He did not respond to requests for comment.

Russia's embassy in Kabul said ousted Afghan President Ashraf Ghani fled the country with four cars and a helicopter full of cash and had to leave some money behind as it would not all fit in, the RIA news agency reported.

Ghani denies taking the money.

Donors have pledged more than $1.1 billion to help Afghanistan, where poverty and hunger have spiralled since the Taliban took power, and foreign aid has dried up.

Running out of dollars, Afghan banks ask Taliban for more cash

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at’s discretion.

Write your thoughts here
Are you sure you want to delete this chart?
Post also to:
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Are you sure you want to delete this chart?
Replace the attached chart with a new chart ?
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
Continue with Google
Sign up with Email