As war rages on, banking services collapse in western Myanmar’s Rakhine State

Residents of Rakhine State say they are running out of money as banks suspend basic services amid a conflict that has left them largely cut off from the rest of the country. In at least seven townships, banks have stopped dispensing cash to customers because there is no longer enough available, according to locals. “With all transportation to Rakhine State blocked by the junta, there is no cash flowing into the state anymore,” said a money-transfer agent from Ponnagyun, one of the affected townships. The restrictions on travel have been in place since last November, when the Arakan Army (AA) launched an offensive that has seen it take control of nine of the state’s 17 townships. The group—since renamed the Arakha Army—has captured much of the northern part of the state, apart from the capital Sittwe and Maungdaw Township, and is also making gains in the south, including in Thandwe Township, an area famous for its beaches. While AA-controlled townships are the most severely affected by the cash shortage, even Sittwe and the major port town of Kyaukphyu, which is also still held by the regime, suffer from a lack of sufficient funds, locals told Myanmar Now. In Thandwe, business owners say they can still withdraw cash from their accounts, but are limited to just two million kyat—roughly US$600—a day. In other areas, such as AA-controlled Myebon Township, many have to rely on cash-transfer services that charge up to 20 percent of the amount being sent, according to locals. “We are being eaten alive,” said a company worker from Myebon, complaining about the exorbitant fees. AA troops stand in front of a branch of the Global Treasure Bank in Kyauktaw in early February (AA Info Desk) This was a sentiment echoed by a resident of Kyaukphyu, where the service fee on a 100,000 kyat transfer is a relatively modest 8,000 kyat. “We live in an era where people have to feed on each other just to stay alive. But I think it will be a very short life if we have to go on like this for much longer,” said one woman. According to KBZ Bank, Myanmar’s largest privately-owned bank, all of its 13 branches in Rakhine State are currently closed except for the one in Kyaukphyu. A woman who works as a money-transfer agent said she recently had to halt transfers to Kyauktaw, Mrauk U, Pauktaw, Minbya, Ponnagyun, Gwa and Ramree townships due to a lack of cash. “This is a huge problem, affecting people’s livelihoods and even their health. It’s worse for people living on what they earn from day to day. They often depend on remittances from relatives living overseas. This is a real hardship for them,” she said. While the regime is responsible for creating this problem, it is up to the AA to solve it, according to veteran Rakhine politician Pe Than. “To help deal with this issue, they could implement a temporary coupon system that would work for trading as well as for shopping,” he said. In addition to restricting transportation in the state, the regime has also imposed strict controls over the import of medical supplies and other essential items, and heavily limited access to telecommunications networks in Rakhine State.

As war rages on, banking services collapse in western Myanmar’s Rakhine State

The lack of cash in the state is adding to the hardships of residents reeling from a conflict that shows no signs of ending

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