Myanmar’s banks serve ONLY ATMs to Myanmar Economy

Yangon, Myanmar (GNJ): Private Banks in Myanmar are being closed since 2 February 2021, a day after Myanmar military toppled down an elected NLD government on 1 February 2021. Almost a month after a military coup that has met with massive popular resistance, Myanmar’s banking system is struggling to function, even as it continues to meet basic needs.

Since February 8, when employees of both government-owned and private banks started joining the Civil Disobedience Movement (CDM) against military rule, financial transactions in the country have slowed to a trickle, according to a bank official who asked to remain anonymous.

“The money flow has just stopped,” the official said, stressing that while most bank operations have been suspended, the system remains intact.

The greatest impact has been felt by trading companies, which are unable to complete transactions with international entities requiring letters of credit or telegraphic transfers due to the closure of banks.

Mr. Joseph Kung Za Hmung, Executive Director of Community Agency for Rural Development (CAD) which is the first NGO in Chin state, said that as banks are being closed, we cannot transfer money for staff salary and project implementation to Chin state, outside Yangon.

While banks continue to fill ATMs with cash every day and online services are still available, ordinary customers are also facing difficulties because of internet cuts by the new ruling regime and restrictions on bandwidth.

Meanwhile, banks continue to pay their employees even though they are unable to generate income from providing loans or offering services such as foreign currency exchange, a worker at a large local private bank told Myanmar Now.

Another major expense, the worker said, is rent. Although some private banks operate hundreds of branches, most are on leased property.

International banks with ties to local banks are also affected, but not as much as those that depend entirely on domestic business, she added.

State-run banks, such as the Central Bank of Myanmar and Myanma Economic Bank, are still running but have been particularly hard hit by the CDM, a Central Bank employee told Myanmar Now.

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