Cash is now king in Lebanon as banks atrophy

Cash is now king in Lebanon as banks atrophy

CHTAURA, Lebanon: The money exchange shop in Lebanon’s Bekaa Valley was buzzing with business. Cellphones pinged endlessly and employees shouted out various rates as customers flocked in carrying plastic bags of the crashing local currency to buy US dollars. “Welcome to the Wall Street of Lebanon,” grinned the storefront’s owner, a machine gun leaning on a rack behind him in case of a robbery. Cash is now king in Lebanon, where a three-year economic meltdown has led the country’s once-lauded financial sector to atrophy. Zombie banks have frozen depositors out of tens of billions of dollars in their accounts, halting basic services and even prompting some customers to hold up tellers at gunpoint to access their money. People and businesses now operate almost exclusively in cash. The local currency in circulation ballooned 12-fold between September 2019 and November 2022, according to banking documents seen by Reuters. Most restaurants and coffeeshops have hung apologetic signs stating that credit cards are not accepted but that dollars are, at the fluctuating parallel market rate. Lebanese use mobile apps to check on the collapsing pound, which has lost some 97 per cent of its value since 2019. Fleets of mobile money exchangers zip to