Faced with a deepening economic crisis, the Taliban has directed all banks in Afghanistan to limit cash withdrawal, permitting only $200 (roughly 2000 afghanis) per week per account holder as thousands of people lined up at banks which open on Sunday for the first time since the collapse of the US-backed Afghan government on 15 August. 

De Afghanistan Bank, the central bank of the country, issued the directives to all banks considering the cash crunch in the market, according to a report in The Khaama Press news agency. Officials, however, asserted the decision was temporary. 

The economic crisis worsened since the Taliban took over power and the country’s reserves in foreign banks were blocked by the US and others. The prices of essentials skyrocketed in the country amid a cash crunch and the prospect of afghani further losing its valuation. 

The country may soon run out of supplies, many reports warned,  as the Taliban continues to struggle to gain access to the state’s reserves. Many countries, including the US and Germany, and the United Kingdom, have cut their developmental assistance to Afghanistan after the Taliban captured power militarily. 

Meanwhile, donors had been providing almost 75 percent of the country’s budget prior to the Taliban takeover. The absence of an interim setup and the delay in the formation of government exacerbated the crisis. Even if the group forms the government in the coming days, it will probably take months for them to get legitimacy--which they need desperately--to access the state’s reserves stacked in foreign banks.

On Saturday, thousands of people protested in Kabul, demanding banks resume their operations. The Taliban has also been asking former government employees to return to work. However, barring the essential services, most employees remain skeptical of the group’s intentions. 

Several shopkeepers in Kabul have even stopped trading in afghanis, according to media reports.  Traders believe it is too risky to deal in afghani as they expect the currency to lose its value in the coming days. 

Meanwhile, the World Food Program (WFP), in an internal report, has warned the country was staring at a humanitarian crisis of an unimaginable scale, and the required urgent assistance to mitigate effects. Over one-third of the population will require food assistance by October this year.