Commercial banks have joined the Central Bank of Nigeria (CBN) in the fight to save the naira by reducing dollar spendings abroad.
Banks have announced temporary suspension of overseas Automated Teller Machine (ATM) naira card transactions to preserve foreign exchange reserves.
First Bank of Nigeria Limited confirmed the new development in emailed note to customers. It said the move was in line with current economic realities.
Banks suspend naira card transactions abroad
It said it will suspend international transactions on its naira Mastercard from September 30.
The CBN rate sheet showed the naira exchanges at N430/$1 at the Investors’ and Exporters (I&E) forex window while black market rate was at N710/$, creating N280/$ premium between both rates.
Banks’ decision followed consistent dollar scarcity and challenges faced by manufacturers and other real sector operators in sourcing foreign exchange from the economy.
Banking sources said banks were increasingly finding it difficult to fund their foreign-currency denominated services, especially online forex transactions and overseas ATM withdrawals, as well as PoS usage overseas by customers.
First Bank said: “Due to current market realities on foreign exchange, you will no longer be able to use the Naira Mastercard, Naira Credit Card, our Virtual card and Visa Prepaid Naira card for international transactions. This will take effect on 30 September 2022.
“Please use your Visa Debit Multi Currency Card, Visa Prepaid (USD) Card and Visa Gold Credit Card to continue transacting abroad with limits of up to $10,000.”
In July, Standard Chartered Bank suspended international transactions on its naira visa debit card.
Fintech firms – Flutterwave, Eversend and other fintech platforms had also stopped virtual card services for international transactions.
In March, financial institutions cut the international spending limit on naira cards from $100 to $20 monthly.
Zenith Bank Plc has also sent emailed notes to customers on the new payment plan abroad.