….Others stop naira card withdrawals abroad
Nigerian banks have again cut down dollar spending limits, just like they did in previous years.
The banks reduced the spending limit to as low as $20 dollars on the Naira debit cards.
Similarly, other banks have equally stopped the naira card withdrawals abroad entirely.
According to the banks, the dollar spending limit is to have more funds to finance foreign exchanges.
Recall that in 2020, the banks reduced the spending limit from around $4000 to $100 dollars.
But this time, the reduction will see Nigerians spending as low as $20 dollars.
Why the new decision:
Banks cut down the spending limits after the Central Bank of Nigeria (CBN) revealed it would stop selling foreign exchanges to them.
Last month, particularly in February, 2022, the CBN said it would stop selling foreign currency to lenders by the end of the year.
According to the CBN, the move is to encourage banks to source their own dollars.
The Nigerian government wants that, by 2025, its yearly target of $200 billion inflows into the country a reality.
Hence, its plans to halt sale of foreign exchange to the banks.
In response, the banks have either reduced or greatly cut down spending on the cards.
Banks who have started cutting down spending limit:
A Bloomberg’s report said about three Nigerian banks have already cut down spending limits.
One of the banks, according to Bloomberg, is the First Bank of Nigeria Ltd.
First Bank has set its limit on its naira Mastercard and naira credit card to $50 monthly.
Another bank, United Bank for Africa Plc (UBA), has also done so.
The UBA completely stopped the use of naira card to withdraw dollars from automated teller machines outside the country.
Executive director with UBA, Chiugo Ndubisi, said of the development thus:
“We want to encourage as much as possible situations where customers are able to access dollars that they have deposited in banks through their domiciliary accounts.”
Similarly, Zenith Bank Plc has equally cut its spending limit to $50.
In a statement, the bank said today’s economic realities has forced it to “temporarily suspended” the same transactions on ATM and POS devices.
What it means:
The implication of this development is that you will no longer use your cards to buy things or pay for things abroad.
Users cannot equally use the cards to make international payments at point of sale devices.
As a student, you will not also pay for international examinations or withdraw euros, dollars or pounds from ATMs to cover expenses while abroad.
Similarly, the highest amount you can spend with your naira debit cards to buy things on web will now be $20 a month.
Further implications to this is that many Nigerians won’t be able to make the volume of transactions they usually make before abroad.
They will also look for alternative ways to continue their transactions or remain denied.