FINANCIAL CONTROL WITHOUT TRANSPARENCY OR ADEQUATE BANKING ACCESS

Human Rights Concern–Eritrea (HRCE) condemns the opaque, coercive and deeply disruptive manner in which the Eritrean authorities have imposed further restrictions on citizens’ possession and use of their own money.

In late June 2026, the Bank of Eritrea reportedly directed individuals, businesses and organisations to deposit their Nakfa cash holdings in commercial banks by 31 July 2026. People without bank accounts were instructed to open accounts, while those who failed to comply were warned that they could face legal action. The authorities did not clearly explain the reasons for the order, the penalties for non-compliance or the protections available to account holders.

On 9 September 2026, the Bank of Eritrea introduced further restrictions through Legal Notice No. 134/2026, which entered into force immediately upon publication. The notice prohibits individuals from retaining more than 25,000 Nakfa in cash for longer than 15 days. Private institutions classified as Grades C, B and A are respectively subject to limits of 50,000, 100,000 and 150,000 Nakfa.

The notice states that legal action may be taken against anyone retaining cash above the applicable limit for more than 15 days without an “acceptable reason.” However, it does not adequately explain what constitutes an acceptable reason, how compliance will be assessed, what penalties may be imposed or how an affected person can challenge an adverse decision.

An inaccessible banking system

These restrictions are especially alarming because Eritrea remains overwhelmingly dependent on cash. There are no generally available ATM, credit-card or debit-card facilities; banking technology is severely limited; and access to bank branches is inadequate, particularly outside major towns.

Citizens are therefore being ordered to place their savings in institutions from which they may be unable to withdraw sufficient amounts when needed. Families require cash for food, healthcare, education, transportation, weddings, funerals, construction and other essential expenses. Small traders, farmers and businesses also depend heavily on cash because functioning electronic alternatives are largely unavailable.

Reports from inside Eritrea describe people queuing outside banks to comply with the directives and avoid possible legal consequences. Elderly people, rural residents, people with disabilities and those living far from a bank are likely to face particular difficulties.

A government cannot reasonably criminalise the possession of cash while failing to provide accessible, reliable and practical alternatives.

A decade of restrictions on citizens’ savings

The latest directive does not stand alone. It forms part of a system of financial control established during the 2015 currency-replacement programme.

Legal Notice No. 124/2015 provided that no more than 20,000 Nakfa could be withdrawn in cash during the redemption process and required larger transactions to be conducted through cheques or other banking instruments. In practice, however, access to deposited money became considerably more restrictive.

People who deposited substantial savings were often permitted to withdraw only very small amounts, sometimes as little as 2,500, 5,000 or 10,000 Nakfa, without being told when they would regain full access to the remainder. 

The monthly withdrawal limit later remained at 5,000 Nakfa, severely restricting families’ access to their own savings. These restrictions made it difficult to meet essential expenses, obstructed trade and business activity, and caused considerable financial insecurity.

Payments exceeding 3,000 Nakfa were also reportedly required to be made by cheque, even though cheques had limited practical use in Eritrea’s predominantly cash-based economy.

The result was that citizens nominally retained ownership of their savings but could not freely access or use them. Families, pensioners, traders and small businesses were compelled to seek permission to withdraw their own money, often after waiting in long queues and without any effective means of challenging a refusal.

The directive issued on 9 September 2026 is therefore not merely a technical banking regulation. It requires people to surrender still more cash into a banking system that has severely restricted access to their savings for approximately a decade.

The cruelty lies in the contradiction: the authorities compel citizens to place their money in banks, deny them reasonable access to it and then threaten legal action if they retain cash outside the same inaccessible system. This turns personal savings into an instrument of state surveillance and control, leaving citizens uncertain whether their earnings will be available when needed.

Secrecy, speculation and public fear

The present measures have revived painful memories of the 2015 currency-replacement programme. Eritreans were then required to surrender old banknotes within a limited period. Amounts above prescribed limits had to be deposited, and notes not exchanged before the deadline became worthless.

The current directives have consequently generated speculation that the Government may be preparing to introduce new banknotes or another currency-replacement programme. HRCE stresses that no official announcement confirming such a plan has been identified. This speculation should therefore not be presented as fact.

Nevertheless, it is the Government’s secrecy and failure to explain its intentions that have created the conditions in which fear and rumours flourish. If a currency change is planned, the public has the right to be informed clearly and sufficiently in advance. If none is planned, the Bank of Eritrea should say so explicitly.

Economic regulation must not become arbitrary deprivation

Governments may adopt reasonable financial regulations to address inflation, illicit transactions or the circulation of currency outside the formal banking system. Such measures must, however, be lawful, necessary, proportionate and transparent, and must include adequate safeguards.

The Eritrean process does not appear to meet these basic standards. Citizens have not received a clear public explanation of:

• the economic problem the measures are intended to address;
• the evidence supporting the restrictions;
• the applicable penalties;
• the meaning of an “acceptable reason”;
• how deposited funds will be protected;
• whether people will be able to withdraw their money when genuinely needed;
• what appeal or review procedure is available; or
• whether a new currency or banknote exchange is being contemplated.

This lack of transparency is particularly serious in a country without an independent legislature, free press, independent judiciary or effective mechanism through which citizens can challenge government decisions.

For decades, Eritreans have been denied their political, civil, social and economic rights. The new restrictions extend state control further into people’s daily lives by limiting their ability to possess, withdraw and use their own earnings and savings.

HRCE’s position and call for international scrutiny

The Eritrean authorities have repeatedly refused to consult citizens, explain major public decisions or respond meaningfully to human-rights appeals. Nevertheless, they remain responsible for the foreseeable consequences of this directive and must disclose its purpose, clarify the penalties and guarantee reasonable access to lawfully acquired savings.

HRCE opposes any policy that criminalises cash possession in a predominantly cash-based economy, restricts access to deposited funds or uses financial regulation as an instrument of surveillance, punishment or political control.

HRCE calls upon relevant governments, donors, international financial institutions and independent experts to examine the directive and its effects, including the risks of arbitrary confiscation, discriminatory enforcement and further impoverishment.

Institutions engaging with Eritrea should demand clarification of the directive’s purpose, penalties, protections for account holders and whether any currency replacement or monetary restructuring is planned.

The experiences of affected citizens, including those unable to access banks or withdraw their money, should be documented for future investigation and accountability.

HRCE condemns the imposition of vague cash restrictions through secrecy and threats of unspecified legal action. Eritreans have the right to earn, retain and use their lawfully acquired money without arbitrary interference.

Economic policy must serve the population, not become another means for an unaccountable government to control and intimidate its citizens.

Human Rights Concern–Eritrea (HRCE)

eritrea.facts@gmail.com